Government policy think Niti Aayog has questioned the role of the consumer affairs department in drafting the fresh set of E-Commerce Rules for Consumer protection saying many of the provisions don’t fall in their domain and should be best left to other competent departments such as the DPIIT, commerce department, home and IT ministries.
Flagging that the many of the proposed amendments fall “beyond the realm” of consumer protection, it has said the proposal of a 72-hour timeline for e-commerce firms to submit replies to orders from government’s investigating agencies should be left to the home and IT ministries.
“Based on an understanding of the Proposed Consumer protection (E-Commerce) Rules, 2020, it can be said that many matters under these rules don’t fall under the ambit of the Department of Consumer Affairs. It is suggested that these be handled by other bodies (ministries or departments or regulators such as such MeITY, DPIIT, CCI etc) that are specialised and better equipped to address the specific nuances pertaining to these issues,” the July 14 office memorandum of Niti Aayog said.
Several government departments had expressed concern over the proposed consumer protection norms for e-commerce companies, arguing that it will ease of doing business and hurt investor sentiment at a time when the country needs investment to push growth.
With reference to the proposal to regulate “flash sales” organised at high discounts by “fraudulently intercepting ordinary course of business using technology to enable specific seller or a group of sellers”, the Niti Aayog has said while these are important questions regarding e-commerce policy, these do not directly deal with consumer welfare.
While adding that this should be left to the DPIIT, the Niti Aayog has said, “The reduced prices offered during ‘flash sales’ tend to promote consumer interest.”
The E-Commerce Rules to protect consumer rights was notified in June 2020 and it’s still in force. But last month the ministry again proposed to bring changes in the notified Rules claiming this was being done after wide consultation with all stakeholders. But several provisions have been opposed by government entities and e-commerce players.
The think tank has said the proposed amendments may have been made to protect the interest of consumers interest, but several provisions are likely to adversely impact the Ease of Doing Business in the “sunrise” sector and that some of the provisions in the proposed Rules are inconsistent with the current FDI policy.
It has also flagged that the proposed provision of mandatory registration of e-commerce entities with the DPIIT, which is not applicable to brick and mortar stores and thereby creates a non-level playing field against the sector that has played critical role during the pandemic. MSN