Consumer Protection Act (New) Rules Notified

Consumer Protection Act (New) Rules Notified

Considering the fact that, e-commerce has gained wide popularity given easy access in India and shopping at the comfort of the home. The Government of India has notified a new set of rules for the safety and betterment of consumers in India to be in effect from 20th July 2020.

The Central Government has notified the Consumer Protection (E-commerce) Rules, 2020 with a view to preventing unfair trade practices, direct selling, and above all the ultimate interests and rights of consumers.

Section 94 of the Consumer Protection Act 2019, authorizes the Central Government to take measures to prevent unfair trade practices in e-commerce, direct selling, and to protect the interests and rights of consumers. The rules following have been framed in the exercise of powers conferred by section 101(1) of the Act.

The rules further provide for the obligations of the e-marketplace e-commerce entities, duties of the sellers on marketplace, duties, and liabilities of the inventory e-commerce entities.

Such entities have also been obligated to maintain appropriate grievance redressal mechanism systems to receive and resolve grievances by such entity from India and to compulsorily appoint a grievance officer for consumer grievance redressed and other details.

How has been an E-commerce Entity defined?

E-commerce entity may be understood as any person either owning, managing, or operating any facility either digitally or electronically on an electronic commerce platform but does not include sellers selling their goods/services on a marketplace e-commerce entity.

Seller means the product seller as defined in the Act and an e-commerce entity shall be an entity registered under the Companies Act 2013 or 1956 respectively or;

An office, branch, or agency outside India owned or controlled by a person resident in India as given in section 2(v)(iii) of the Foreign Exchange Management rules.

What do the Consumer Protection Act (New) rules provide for?

A.    Section 18 of the Consumer Protection Act 2019, gives authority to the Central Consumer Protection Authority to-

1.     Protect, promote, and enforce the rights of consumers as a class, and prevent violation of Consumers' rights under the Act.

2.    Prevent unfair trade practices and ensure that no person engages himself in unfair trade practices;

3.    Ensure that there is no false or misleading advertising is made of any goods or services which contravenes the provisions of this Act or rules or regulations made thereunder.

4.    Inquire or cause an inquiry or investigation to be made into violations of consumer rights or unfair trade practices, either suo motu or on the directions from the Central Government.

5.    File complaints before the District Commission, the State Commission or the National Commission as the case may be;

6.    Review matters relating to factors inhibiting the enjoyment  of  consumer  rights, including safeguards provided for the protection of consumer rights under any law for the time being in force and recommend remedial measures for effective implementation;

7.     Recommend adoption of international covenants and best international practices on consumer rights to ensure effective enforcement of consumer rights;

8.    Mandate the use of unique and universal goods identifiers in such goods as may be necessary, prevent trade practices and to protect consumers' interest, power of district collector, complaints to authorities.

9.    Issue safety notices and necessary guidelines to prevent unfair trade practices and consumer interest.

10.    Advise the Ministries and Departments of the Central Government and state governments on consumer welfare measures.

11.    As per these rules, the Central Government, the Central Council which shall consist of the following members, not exceeding thirty-six namely-

a.    The Minister in charge of the consumer Affairs of the Central Government shall be the Chairperson of the Central Council;

b.    The Minister of State(where he is not having an independent charge) or the Deputy Minister in charge of Consumer Affairs in the Central Government shall be the Vice-Chairman of the Central Council;

c.    The  Minister-in-charge of Consumer Affairs of the two states from each region as mentioned in Sch-I to be changed by rotation on the expiration of the term of the Central Council on each occasion;

d.    An Administrator of a Union Territory to be changed by rotation on the expiration of the term of the Central Council on each occasion

e.    Two members of Parliament composing of one each from Lok Sabha and the other one form the Rajya Sabha respectively;

f.    Representatives of the departments of the Central governments not exceeding five to be nominated by the Central Government.

g.    Representatives with proven expertise and experience who are capable of representing consumer interests not exceeding three;

h.    Secretary-in –charge of the Consumer Affairs in the Central Government shall be Member Secretary of the Central Council.


eStartIndia Team

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