IAMAI welcomes the Consumer Protection (e-commerce Rules) 2020

Internet and Mobile Association of India as the representative of B2C and B2B ecommerce companies has welcomed the Consumer Protection (Ecommerce) Rules released by the government on 23 July 2020. The Rules correctly understands that there are two different models of etailing; a) inventory based b) platforms or online marketplace, requiring different levels of direct responsibility to consumers. 

Recognition of online marketplaces as ‘intermediaries’ thus helps absolve them of certain product liabilities, which now rightly lie with sellers conducting their business on such platforms. Sellers are now mandated to take responsibility for ‘goods or services that are defective, deficient or spurious’ and cannot refuse to take back such goods. Sellers are also required to establish grievance officers who have to respond in timebound manner.

The new rule makes provision for platforms having to share particular details about sellers to customers for ‘communication with the seller for effective dispute resolution’ only ‘on a request in writing made by a consumer after the purchase of any goods or services on its platform by such consumer’. This is a welcome relaxation from the earlier mandatory publication of all seller details for such platforms.

The new rules in particular do justice to the concerns of online marketplaces about the earlier liabilities for counterfeit products, which now rightly lie with the sellers conducting business on these platforms. Platforms now are mandated to make ‘reasonable efforts to maintain a record of relevant information’ that allow identify sellers who are repeat offenders for offering spurious goods. Furthermore, platforms are now no longer mandated to take corrective actions and can off-board such sellers on a ‘voluntary basis’.

However, the association highlighted the need for an extension of application of the rules from its present mandate of date of notification since logistics services are still settling in under COVID-19 challenges and changing/ recoding platforms to implement some of the new provisions will take time.