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Views on the proposed ammendments to the Consumer Protection (E-Commerce) Rules, 2020

Person holding a phone with ecommerce cart flying out to depict policy recommendations submitted by AnantLaw on Consumer Protection, E-Commerce Rules, 2020 India

The emergence of global supply chains, rise in international trade and the rapid development of E-Commerce have led to new delivery systems for goods and services and have provided new opportunities for consumers. The E-Commerce Sector in India (“E-Commerce Sector”) has been the backbone in the fight against the Covid-19 pandemic and it was because of this sector that the basic needs of the people could be met with. On the other hand, the development of the E-Commerce Sector has rendered the consumer vulnerable to new forms of unfair trade and unethical business practices and violation of personal data and information secrecy. Misleading advertisements, telemarketing, multi-level marketing, direct selling, flash sales and e-tailing pose new challenges to consumer protection.

For redressal of such issues, the Consumer Protection Act, 2019 (“Consumer Act / Act”) came into effect on 20 July, 2020 replacing the almost three decades old previous Consumer Protection Act, 1986 (“Erstwhile Act”). The Consumer Act also ensured to bring the E-Commerce Sector under its structured umbrella.

The introduction of the Consumer Protection (E-Commerce) Rules, 2020 on 23 July 2020 (“E - Commerce Consumer Rules / Rules”) was intended to make a paradigm shift in the regulation of the E-Commerce Sector. However, recently the Government of India (“GOI”) through the Ministry of Consumer Affairs, Food and Public Distribution (Department of Consumer Affairs) (“Ministry of Consumer Affairs”) has felt the need to seek views / comments / suggestions on the proposed amendments to the Consumer Rules (“Proposed Amendment”) because of multiple complaints being received against widespread cheating and unfair trade practices. The new draft proposes a host of changes such as:

  1. Mandatory registration requirements for online retailers

  2. Greater scrutiny of flash sales

  3. Enhanced liability of E-Commerce Entities

  4. A stronger grievance redressal mechanism

We appreciate the endeavours and intent of the GOI, as it has clearly recognised the urgency for reforms in the E-Commerce Sector. We hereby submit our views and observations with respect to ECommerce Rules and more particularly to the Proposed Amendments. Our views and observations with respect to the Proposed Amendment are structured in two parts.

The First part discusses the existing framework of the E-Commerce Consumer Rules and the intent behind introducing such rules. The Second part encapsulates our recommendations and suggestions to the Proposed Amendment.

060721 AL PR - Consumer Protection
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