10 Must Know E-commerce Rules for all Business Houses

10 Must Know E-commerce Rules for all Business Houses

10 Must Know E-commerce Rules for all Business Houses

10 Must Know E-commerce Rules for all Business Houses

The Ministry of Consumer Affairs, Food, and Public Distribution notified new Consumer Protection Rules, 2020 w.r.t E-Commerce recently. Keeping in alignment with the new Consumer Protection Act, 2019 (notified in July 2020), the new rules seek to expand the scope and protection of Consumer Rights in the E-commerce sector. The Rules provide for consumer-centric regulation of the e-commerce sector. The major legal infrastructure for such protection is provided for in the Consumer Protection Act, 2019 which allows consumers to file complaints in their resident district, instead of the seller/provider's district.

The new Consumer Protection (E-Commerce) Rules, 2020 cover all services and goods as well as digital products that are sold through the medium of electronic network. This includes various models of e-commerce such as direct or indirect retailers and whole-sale sellers as well. These New Rules are in form of strict obligations that must be followed by all the E-commerce platforms. These can be broadly summarized as follows:

1. The E-commerce platform must clearly and legibly provide complete information w.r.t it registered Legal Name, complete address of its location along with the address of its Headquarters, and allied branches. It must provide name and allied details of its electronic platform (website, website carrier if it is an intermediary), and other crucial contact details like email address, fax number, contact number of customer care cell, and grievance officers.

2.  It is mandatory for all E-commerce websites and businesses to set-up a grievance redressal mechanism or apparatus. Such a cell must have a grievance redressal officer for consumer complaints. His name and contact details must be properly furnished on the concerned e-commerce website itself. In addition to this, the officer must be able to acknowledge the complaint within 48 hours and resolve the complaint within a stipulated time frame of one month from the date of receipt.

3.  Many E-commerce entities may be based out of India. For such businesses and sellers, it is mandatory to mention complete details and the contact number of the importer intermediary.

4.  The New Rules also prohibit E-commerce businesses from the extraction or penalizing of its consumers for canceling services/goods/products. Therefore, they cannot solicit any cancellation charges or penalties from their consumers.

5.  Apart from the above rules, the E-commerce entities must now explicitly, separately, and clearly obtain and record the consent of the consumer to purchase any goods or services or digital products. This means the consumer must be able to synchronically express his consent to buy the goods/services/products and the same cannot be assumed by virtue of the consumer clicking on any random/obscure call-to-action. Such a practice can be considered unfair under the rules.

6. The E-commerce websites are prohibited from indulging in practices that can be considered manipulative w.r.t product/service pricing in order to gain an unreasonable edge or influence over the consumer. Any pricing detail which is misleading also falls under this provision.

7. It is seen that publishing of manufactured/paid reviews has become a common malpractice w.r.t e-commerce entities. This amounts to misleading advertisement and is strictly dealt with under the Consumer Protection Act, 2019. The New Rules also prohibit such practice of fake reviews.

8.The E-commerce seller cannot refuse to take back goods, withdraw, discontinue services that have been bought or agreed to be bought by the consumer. He cannot refuse a refund of defective goods/services, including those that fail to match their description as provided by the seller.

9.  Apart from the above rules dealing with various aspects of the e-commerce business, specific provisions have been made for proper billing and inventory generation as well. The inventory of every the transaction must mention the details of return, refund, warranty, guarantee, delivery, shipment, cost of return shipping, mode of payments, grievance redressal mechanism, all mandatory notices, information, mention the total amount in a single figure, mention break-up price as well as complaint number details to make tracking easier for the consumer.

10. Market Place E-commerce entities are additionally required to ensure that any images or descriptions, including content, is authentic. The appearance, quality, nature, and other important features of the goods/services must be clearly mentioned and the delivered product/service must adequately match the description. They must provide appropriate information on the platform to help the consumer make informed decisions. Such information includes details of the e-commerce service/goods provider, name of the business, registration details, address and location, customer care number, truthful feedback, exchange/refund/return policy, warranties and guarantees, grievance redressal mechanism, etc. All information must be provided in a simple and legible manner for the consumer. Along with this, the E-commerce entity must also mention the unique handling or manufacturing conditions of the goods/services.


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