E-commerce under Consumer Protection Act, 2019

E-commerce –

The act defines E-commerce under Section 2(16) as buying or selling of goods or services inclusive of digital products on a digital or an electronic network.
The Government has notified Consumer Protection (E-commerce) Rules, 2020 under the Consumer Protection Act, 2019.
The rules are applicable to:
Every goods and service that are bought or sold over digital or e- network inclusive of digital products;
All forms of e-commerce, including marketplace and inventory models of e-commerce;
All e-commerce retails, inclusive of multi-channel single-brand retailers and single-brand retailers in single or multiple formats; and
All types of unfair trade practices across all models of e-commerce[1]
In case of violation of E-commerce rules, the provisions of the Consumer Protection Act 2019 are to be applied.[2]

Duties of E-commerce Entities

As per the Rules, the e-commerce entities must be one of the following types of registered entity:

A Company incorporated under Companies Act, 1956 of Companies Act, 2013
A Foreign company covered under Section 2(42) of Companies Act, 2013
An Office, branch, or agency outside India owned or controlled by a person resident in India under Section 3(v)(iii) of the Foreign Exchange Management Act, 1999.

The above-mentioned entities have the following duties:

Provide the users with the following information in a clear and accessible manner on a displayed platform:
E-commerce entity’s legal name.
The principal address of its headquarters and all branches
Its website’s name and details; and
Details of contact for customer care and grievance officer
No unfair trade practice should be adopted, either in course of business or otherwise
An adequate grievance redressal mechanism should be established and a grievance officer should be appointed for the same and the officer shall acknowledge the complaints within 48 hours from the date of receiving the same and the same should be redressed within 1 month. Contact information of the grievance officer is to be displayed on the platform.
If the entity offers imported goods and services, the name and details of the importer from whom goods and services are being purchases should be mentioned.
Should put in best efforts to become a partner in the convergence process of the National Consumer Helpline of the Central Government
Unless the e-commerce entity itself has to bears the cancellation charges the same should not be imposed upon the consumers.
All payments towards accepted refund requests of the consumers as prescribed by the Reserve Bank of India or any other competent authority under any law should be effected.
Should not change the prices of goods or services offered on its platform to gain unreasonable profit or discriminate between consumers of the same class or make any unreasonable classification of consumers affecting their rights under the Act.[3]

Liabilities of Marketplace E-commerce Entities

In addition to the above-mentioned duties, a marketplace entity has to furnish the following information in the prescribed manner:
Details about the sellers, including the name of the business, address, customer care number, any rating or feedback, and any other information that is important for allowing consumers to make an informed decision at the purchase stage.
Ticket number for tracking the status of the lodged complaint.
Information that relates to return, refund, exchange, warranty and guarantee, delivery and shipment, modes of payment, and grievance redressal mechanism.
Information relating to available payment methods, the security of those methods, any fees or charges payable by users, the procedure to cancel regular payments, charge-back options, and contact information of the relevant payment service provider.[4]

Duties of Sellers on the marketplace

Some of the relevant duties given for the sellers under the rules are:
To not adopt any unfair trade practice neither during offer on its platform nor otherwise
To not refuse to take back goods or withdraw or discontinue services purchased or agreed to be purchased or refuse to refund consideration if such goods or services are defective, deficient, or spurious or if such goods or services are delivered late from the estimated delivery date.
Have a written contract with respective marketplace its entities on whose platform they are planning to undertake or solicit the sale or offer their goods or service.
To make sure that advertisements for marketing are in consonance with the actual characteristics of the goods or services
Provide the e-commerce entity with legal name, address of headquarter and branches, name and detail of the website, email address, customer care details, GSTIN, and PAN details.[5]

Duties and liabilities of Inventory E-Commerce Entities

“inventory e-commerce entity is an e-commerce entity which owns the inventory of goods or services and sells such goods or services directly to the consumers and also includes single-brand retailers and multi-channel single-brand retailers;
The duties and liabilities of Inventory E-commerce entities discuss under Rule 7 of the Consumer Protection Rules, 2020.
Since the “inventory e-commerce entities” are direct sellers their compliance requirements are similar to the ones applicable to the sellers on “marketplace entities”.[6]

Conclusion

Its rules clearly aim to bring transparency to its platforms for the consumers. The rules are also towards creating a check on the preferential treatment and biases that are accord to some sellers. This provides fair and equitable treatment for individual and small sellers on e-platforms and also diminishes the chances of unfair trade practices by large sellers. The rules mainly provide for the compliance mechanism. In order to make sure that the entities understand the procedure properly and adhere to the same.