The Ministry of Consumer Affairs has recently shared draft guidelines on e-commerce for consumer protection. Named as the e-Commerce Guidelines for Consumer Protection, 2019, these rules will be applicable to all business-to-consumer (B2C) e-commerce platforms. This set of norms is designed to act as the guideline for e-commerce businesses in preventing fraudulent activities and unfair trade practices, and to provide necessary protection to the rights and interests of the customers. The regulations cover key aspects like addressing the issue of counterfeit products, ensuring the integrity of reviews, increasing contract transparency with sellers, and mandatory disclosure of seller information.
Compulsory Return Policy
As per the new rules, it will be obligatory for e-commerce entities to accept returns if the products delivered are defective, incorrect, spurious or do not match the advertised features or characteristics.
Disclosure of Seller Details
The draft also stipulates that e-commerce companies will have to publicly display details regarding the sellers on their website. This includes providing detailed information about the type of business furnished by the selling entity.
Fair and Transparent Contract Terms
The draft guidelines strive to enhance transparency in contracts made between e-commerce entities and the sellers. It directs the e-commerce platforms to list terms of their contracts related to return, refund, exchange, warranties and guarantees, delivery and shipment, mode of payments and resolving grievances.
Grievance Redressal Mechanisms
The draft lays down rules on transparency regarding procedures followed to redress complaints. E-commerce companies are required to publish contact details of their grievance officers on their websites and are obliged to address any complaints within one month from the date of registration of the complaint.
Fair Pricing Policy
E-commerce platforms are restricted from directly or indirectly manipulating the price of the products and services they offer.
Prevention of Unfair Trade Practices and False Reviews
The new rules prohibit e-commerce platforms from resorting to any trade practice aimed at promoting the sale, use or supply of any goods or services that could potentially influence the consumer’s transactional decisions through unfair methods. Additionally, sellers are restricted from falsely representing themselves as consumers, posting reviews, misrepresenting or exaggerating the quality and features of their products on their sites.
| Fact | Detail |
|---|---|
| Internet User Addition Rate | One user every three seconds |
| E-commerce Sector Worth by 2028 | $230 billion (10% of India’s retail) |
| Expected Online Shoppers in 2018 | 120 million |
| Expected Online Shoppers in 2025 | 220 million |
| E-commerce Market Ranking by 2034 | Second largest in the world |
Indian E-commerce Market
As per a 2019 report by Morgan Stanley, India is adding one internet user every three seconds. It predicts that the nation’s e-commerce sector will reach $230 billion by 2028, contributing to 10% of India’s overall retail. Fuelled by the surge in online users, increasing penetration of smartphones, and the growing popularity of social media platforms, the Indian e-commerce industry is expected to surpass the US to become the second largest e-commerce market globally by 2034. The number of online shoppers in India, that is expected to touch 120 million in 2018, is projected to reach 220 million by 2025.