Member Consultation: Revised draft of e-Commerce Rules

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Member Consultation: Revised draft of e-Commerce Rules

Garima Prakash

@GarimaP

June 22, 2021

Public Policy

220

The Department of Consumer Affairs (DoCA), Ministry of Consumer Affairs, has released draft amendments to the Consumer Protection (e-Commerce) Rules, 2020 (e-Commerce Rules) for public consultation.

Several significant amendments have been proposed by the DoCA. These include proposals to:

Require mandatory registration of e-commerce entities with the Department for Promotion of Industry and Internal Trade (DPIIT).
Require e-commerce entities to appoint a Chief Compliance Officer, a Nodal Officer, and a Resident Grievance Redressal Officer (similar to the obligations proposed for Social Media Intermediaries under the recently notified Intermediaries Guidelines).
Require strict compliance with Country-of-Origin declarations, coupled with obligations to ensure that ranking algorithms do not discriminate against domestic goods.
Require disclosures relating to data shared for purposes of cross-selling of goods.
Removal of default checkboxes for obtaining consumer consent wherever applicable.
Require disclosures of sponsored results on search results.
Prohibit flash-sales on e-commerce platforms.
Extend the ambit of the e-commerce Rules to competition aspects, by providing a general obligation of dominant e-commerce entities to not abuse their dominant position as defined under the Competition Act, 2002.
Require e-commerce entities to assist Law Enforcement Agencies within 72 hours of receiving a request.
Include obligations on logistics providers to not discriminate between similarly placed sellers.
Introduce data management obligations which ensure that marketplace entities do not leverage data collected towards providing an unfair advantage to themselves or associated entities.
Introduction of a “fall-back” liability upon e-commerce Players in the event a seller fails to meet its duties and obligations vis-à-vis a consumer.

For a more comprehensive list of proposed amendments, please refer to the link here.

Given the significance of the proposals, and the potential impact on the e-commerce industry, NASSCOM is inviting inputs/responses on the proposed amendments latest by July 1, 2021. Kindly send your inputs to garima@nasscom.in.

Context to the proposed amendments

The existing e-commerce Rules were notified pursuant to Section 101(1)(zg) of the Consumer Protection Act, 2019, on July 23, 2020. The primary intent of the e-Commerce Rules was protecting consumer interests in the e-commerce space through greater transparency and accountability placed upon e-commerce entities, and creating a uniform set of rules for both e-commerce platforms and sellers. NASSCOM's analysis of the existing e-Commerce Rules can be found here.

The first set of amendments to the e-Commerce Rules were issued on May 17, 2021, to clarify that only certain types of e-commerce entities need to appoint a nodal officer, while other forms, such as, sole proprietorship and partnership firms are not obligated to appoint such nodal officer. More information on this amendment can be found here.

Earlier in March 2021, Rajya Sabha Committee on Subordinate Legislation had presented its report on the e-Commerce Rules, 2020. Highlights of the recommendations made by the Committee can be found here. Some of the suggestions included in the Committee’s report, have been included in the present set of proposals from the DoCA.

#ecommerce #ecomemrcepolicy #consumerprotection #e-commerce

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Garima Prakash

Manager, Public Policy and Government Affairs

Reach out to me for all things policy about e-commerce, international trade, export controls, start-ups and fintech