At a time when online transactions have steadily shot up, the need for a separate law or agency to tackle consumer grievances has been evaluated by various agencies. (Representative image) Photograph: (AFP)
Complaints by consumers to the National Consumer Helpline rose by more than 300%
India has the fastest growing e-commerce market in the world, valued at more than $12 billion. Unfortunately, the number of consumer complaints against India’s leading e-commerce companies has also steadily shot up.
The Minister of State for Consumer Affairs Mr CR Chaudhary shared the details of complaints received against e-Commerce companies during the last three years with the Lok Sabha. And the numbers shot up by more than 300%.While the National Consumer Helpline registered 418 complaints during 2014-15, the number shot up to 1,386 till December 2016.
Need for a separate law
At a time when online transactions have steadily shot up, the need for a separate law or agency to tackle consumer grievances has been evaluated by various agencies.
A study conducted by the Indian Institute of Management Ahmedabad, stressed on the need for a separate law for e-commerce. The study was reviewed proposed amendments in the Consumer Protection Act.
The Indian government too considered the need for a regulator for e-commerce in India. An Inter Ministerial Committee was setup in 2014 to evaluate the need for a regulator for any form of direct selling or multi level marketing.
But as per the government of the day, there is no proposal to bring in a separate legislation for e-commerce platforms. The Consumer Affairs minister, in his reply to the Lok Sabha, maintained that under the new Consumer Protection Bill, the Central Consumer Protection Authority should be good enough to look into any consumer complaints against e-commerce companies.
The global scenario
The debate around e-commerce law is not new.
The boost in e-commerce business in 1990s sparked off the first debate around regulation. Taking a cue, the United Nations General Assembly in 1996 approved a model law. The purpose of the Model law of Electronic Commerce was to ‘offer national legislators a set of internationally acceptable rules’.
Similarly, the European Union as well issued the Electronic Commerce directive in 2000, with an aim to set up ‘an internal market framework for electronic commerce, which provides legal certainty for business and consumers alike. ’
Countries at the center of e-commerce activity have developed frameworks overtime to carry out business.
The United States has three key laws, laying out measures for economic activity online- The Anticybersquatting Consumer Protection Act, Children's Online Privacy Protection Act, and the Electronic Signatures in Global and National Commerce Act.
Post the guidelines from the European Union, the UK government too introduced the Consumer Protection Regulations Act in 2000. This was later repealed in June 2014, and replaced by the Consumer Contracts and Regulations act-which had specific provisions to protect consumers transacting online.
Closer to home, China’s lawmakers presently are debating a draft law to regulate the world’s largest e-commerce market.
In India, the shutdown of consumer internet search platform AskMe and its sister concerns-AskMe Bazaar and Mebelkart last year, sent shockwaves in the industry.
The Indian Government, with the new consumer protection law, has proposed several amendments to empower regulatory authorities. This includes powers to recall products and initiate class action lawsuits against defaulting companies.
But the law still awaits the nod of our parliamentarians.