The Department of Consumer Affairs is proposing a series of amendments to consumer protection rules that ban e-commerce companies like Flipkart and Amazon.com Inc., owned by Walmart Inc., from flash sales and increase their responsibilities for non-ordering. executed.
The rules are part of a 14-page draft consumer protection amendment posted on the Consumer Department’s website late Monday evening. The ministry is seeking comments until July 6.
With the proposed changes, the government has said it aims to bring transparency to e-commerce platforms and further strengthen the regulatory regime to tackle widespread unfair trading practices.
Among the key guidelines, no e-commerce entity will conduct flash sales as it limits consumer choice.
The rules also try to put an end to related party sellers and have asked e-commerce companies to ensure that none of their related parties are listed as a seller to sell directly to consumers.
The ministry said the companies will qualify as related parties if they have 10% or more beneficial ownership in common. “The companies will also be considered as linked to each other through a common chain of directors or managing partners, shareholders, where these shareholders hold at least 5% of the shares of the linked companies”, indicates the project.
E-commerce businesses that cross-sell goods and services are also required to provide adequate information to users.
Ecommerce entities are also encouraged to ensure the appointment of a compliance officer and nodal contact person for 24/7 coordination with law enforcement agencies. In addition, e-commerce companies will also appoint agents to ensure order compliance and a resident grievance officer to address consumer grievances on the e-commerce platform.