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Consumer Protection (E-commerce) Rules 2020
Consumer Protection (E-Commerce) Rules, 2020
Change is constant and as the old saying goes, Everything changes with time. This saying suits all seasons and all days. Linking this to the present situation, We have seen massive changes in our markets, trade, and commerce. The markets have literally evolved from being an actual physical place to a virtual one. From this we clearly understand that we have a new market, new dynamics, and new challenges, calling for a new law.
Therefore the Consumer Protection Act, 1986 needed to be modified. Accordingly, the Legislature took a conscious decision to repeal its predecessor and enact a new statute by passing the Consumer Protection Act, 2019.
The balanced relationship between market dynamics and consumer interests has always been a challenge for governments across India. In reality, markets have been favoring the seller and his profit margins by giving little importance to the interests of the consumers. This gap is going on widening as e-commerce platforms have paved their way into the markets. Many legislations were brought across the globe to protect the consumer's interest. India being a developing country has always welcomed such dares and enacted the Competition Act, 2002 to ensure real and fair competition in the markets. But what touches and reaches to the individuals as consumers are The Consumer Protection Act (COPRA).
With the changing trend that is markets becoming virtual, bigger, and better it was vital to renovate the consumer protection law in its entirety. Moreover, not to forget that new challenges and required resources for the same were equally important reasons to rebuild the consumer legislations. With this intention, the COPRA, 2019 came into effect.
The core of the Act focuses on consumer interests and therefore it is more consumer-centric now. This could be evidently seen when the territorial and pecuniary jurisdictions were altered accordingly. The complete focus was admitted to decreasing the misery of the consumers and travails and cumbersomeness of the consumer forums. As every coin has its two sides, This was a huge relief as well as a probe to misuse by unprincipled litigants.
E-commerce rules 2020 :
Although e-commerce transactions were not alien to the existing Act, the new Act has made visible efforts to make the structure of these platforms more efficient and effective so that it can run together in synch with consumer's interests.
The central government notified the Consumer Protection (E-commerce) Rules, 2020 so as to streamline the functioning of the grievance mechanism, even though there were solutions existing. Like things are always black and white, similarly, e-commerce opened new modes and methods of faster and easy transactions and at the same time unfair trade practices were happening.
The enlargement of the definition of consumer under section 2(7) of the Act by including both online and offline transactions within the scope of ‘buying goods’ and ‘hiring services’ has made it necessary to closely look into e-commerce and online transactions. The Act specifically addresses the most commonly faced issues such as refusing to take back defective goods or refusing to refund the amount.
The rules are applicable to:
(i) All goods and services bought or sold over the digital or electronic network including digital products;
(ii) All models of e-commerce, including marketplace and inventory models of e-commerce;
(iii) All e-commerce retail, including multi-channel single-brand retailers and single-brand retailers in single or multiple formats; and
(iv) All forms of unfair trade practices across all models of e-commerce.
The legislation intends to keep the consumer's interest at the peak and also clearly defines the relevant players of the e-commerce space, such as e-commerce entity, inventory e-commerce entity, marketplace e-commerce entity, and seller.
Duties of e-commerce entities:
- To appoint a nodal person of contact or a senior designated official to ensure obedience with the provisions of the Act and Rules.
- No more tailored responses to grievances. The players have to display the contact number, e-mail, fax, landline, and mobile numbers of customer care or grievance officer.
- The entities have to set up a grievance redressal mechanism that looks at the number of complaints generally received from India.
- Henceforth, The platforms are not allowed to levy cancellation fees when the customer cancels the order unless the entity also submits to incur the charges if it unilaterally cancels the order for any reason.
- Marketplace e-commerce entities are now bound to secure an undertaking from the seller that description, images, etc. of the goods on the websites or apps are accurate and correspond directly to the actual goods or services.
- The platforms are now required to give information such as the name and details of the website, email address, and other information required for communication with the seller for dispute resolution to the consumer.
- E-commerce platforms are not allowed to record the automatic consent of the customer.
Duties of sellers and inventory e-commerce entities:
The obligations of the seller and inventory e-commerce entities are covered together. The following rules apply to both:
- To appoint a consumer grievance officer to rectify the complaints in a clear, effective, and efficient manner.
- They are hereby not allowed to refuse to the return requests of the goods or discontinue services or refuse to refund the consideration if the goods or services turn defective, or do not match the specifications displayed on the platform, or if the delivery is made late.
To conclude, the latest changes added to the Act make it more consumer-oriented and it is at par with the international standards of consumer laws. The breach of these rules will attract the provisions of the Act, therefore, no e-commerce companies can escape from these rules.
