Consumer Protection Act 2019: Feeling short-changed by a host of e-commerce websites that fuel online purchases, customers now also have hope. The Ministry of Consumer Affairs has drawn up detailed guidelines on customer interaction by e-commerce companies, and any complaints can be brought to consumer protection commissions.
Under the new regulations, any e-commerce entity will have to appoint a grievance resolution officer. They have to accept all grievances within 48 hours and settle complaints within one month. The companies would have to provide the location and contact information of the sellers as well.
“No e-commerce entity shall impose cancellation charges on consumers canceling after confirming purchase unless similar charges are also borne by the e-commerce entity if they cancel the purchase order unilaterally for any reason,” said the new rules released this week.
The feature comes as a huge relief for shoppers who sometimes have to face cancelation charges without the same penalty for the seller.
As most e-commerce websites tend to revise commodity prices on the basis of demand, the new rules warn against manipulating the prices of goods or services offered on their platform “in such a manner as to gain unreasonable profit by imposing on consumers any unjustified price having regard to the prevailing market conditions…”
Although the latest Consumer Protection (E-Commerce) Regulations, 2020 have been issued by the Ministry, it may take some time before they come into force. Such laws are part of the Consumer Protection Act 2019, which substituted the law of 1986. The other primary provisions of the new Consumer Protection Act 2019 will come into effect from 20 July. The new act, which replaced the three-decade-old law, would allow for the creation of mediation cells, the pecuniary jurisdiction of the district, state, and national consumer commissions.
The e-commerce industry is rising rapidly in the country, even though it accounted for just 3.5 percent of overall retail sales in the world. According to the Bain and Company report, the country’s e-commerce market will hit $100-120 billion in gross merchandise value ( GMV) with 300-350 million users over the next five years, up from the existing 100-110 million shoppers. The new GMV amounted to around $30 billion. The Government is also planning a separate e-commerce regulation, which will regulate the functioning of these organizations with data security and local use laws. The pandemic also forced people to rely on e-commerce websites to do much of their shopping, and business was rising from Tier II and smaller cities.
The E-Commerce Guidelines were eagerly awaited as they offered a response to customers who are covered by the Consumer Commission and add clarity to their operations. Under the new Consumer Protection (E-Commerce) Rules, 2020, each e-commerce company will have to appoint a nodal officer to ensure the protection of consumer law. They will provide full details of its activities, contact information, address, landline, and mobile customer service numbers. They will also set up redress mechanisms for complaints where each complaint is resolved within one month.
In order to provide consumers with a level playing field, each e-commerce entity shall only record the consumer’s consent at a later date and not automatically, including in the form of pre-ticked checkboxes.
In another interesting intervention, the rules state that no seller may falsely represent himself as a consumer and post review of goods or services or misinterpret the quality or characteristics of goods or services. This has been done in such a way that bias reviews do not influence consumer choices.
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The rules prevent the seller from refusing to take back the goods if they were defective, deficient, or spurious. The rules also include detailed details on return, refund, exchange, warranty and guarantee, distribution and storage, return shipping costs, mode of payment, grievance resolution mechanism, and also on the overall price in a single amount, along with the description of all charges.