The Government of India has planned to tighten rules for e-commerce marketplaces like Amazon and Flipkart and has proposed several amendments to Consumer Protection (E-commerce) Rules of 2020.

Backdrop

This decision was taken following complaints from small businesses. They have accused e-commerce marketplace of misusing market dominance and deep discounting by online retailers. Amendments have been proposed at a time when large e-commerce marketplaces like Flipkart and Amazon India are being investigated by Competition Commission of India for alleged abuse of market dominance. The Competition Commission of India probe also focuses on deep-discounting practices that e-commerce marketplaces often come up with.

Proposed Rules

  • The Amended propose to limit ‘flash sales’ of goods and services by e-commerce companies.
  • However, it does not ban Conventional e-commerce flash sales. Some specific flash sales or back-to-back sales that limit customers choice, increase prices & prevents a level playing field will not be allowed.
  • Indian E-commerce firms will have to establish adequate redressal mechanisms and appoint a chief compliance officer.
  • Companies are also required to name a resident grievance officer who has to be a company employee and a citizen of India. He will serve as nodal point of contact for law enforcement agencies.

Amendments to Consumer Protection E-commerce Rules 2020 Amendments to Consumer Protection E-commerce Rules 2020