Economy

New Consumer Protection Act comes into force

Our Bureau New Delhi | Updated on July 21, 2020

The Central Government will soon be notifying new norms for e-commerce companies for consumer complaint redressal, as part of the Consumer Protection Act 2019, which came into effect from Monday.

In an official statement, Union Minister for Consumer Affairs, Food & Public Distribution Ram Vilas Paswan, said the rules for prevention of unfair trade practices by e-commerce platforms will also be covered under the Act. He pointed out that the new Act has been introduced after many amendments to provide protection to buyers not only from traditional sellers but also from the new e-commerce retailers and platforms.

According to the Act, e-commerce platforms will need to acknowledge the receipt of any consumer complaint within 48 hours and will need to redress the complaint within one month from the date of receipt, as per the norms set under the Act.

The gazette notification for the establishment of the Central Consumer Protection Authority and rules for prevention of unfair trade practice in e-commerce are under publication, the official statement added.

 

Paswan said under the Act, every e-commerce entity is required to provide information regarding return, refund, exchange, warranty and guarantee, delivery and shipment, modes of payment, grievance redressal mechanism, payment methods, security of payment methods, charge-back options including country of origin, which are necessary for enabling the consumer to make an informed decision at the pre-purchase stage on its platform.

Empowering consumers

“This new Act will empower consumers and help them in protecting their rights through its various notified Rules and provisions like Consumer Protection Councils, Consumer Disputes Redressal Commissions, Mediation, Product Liability and punishment for manufacture or sale of products containing adulterant or spurious goods,” he stated.

The Act includes rules for establishment of the Central Consumer Protection Authority (CCPA) to protect and enforce the rights of consumers. The CCPA will be empowered to conduct investigations into violations of consumer rights and institute complaints and prosecution, order recall of unsafe goods and services, and order discontinuance of unfair trade practices as well as misleading advertisements. It will also have powers to impose penalties on manufacturers,endorsers and publishers of misleading advertisements, the statement added.

The government believes that the new Act will also simplify the consumer dispute adjudication process in the consumer commissions. The Minister said an alternative dispute resolution mechanism of mediation has been provided in the new Act.

According to the Consumer Disputes Redressal Commission Rules, there will be no fee for filing cases up to ₹5 lakh. There are also provisions for filing complaints electronically and credit of amount due to unidentifiable consumers to Consumer Welfare Fund (CWF).

Paswan stated that the new Act also introduces the concept of product liability and brings within its scope, the product manufacturer, product service provider and product seller, for any claim for compensation. The Act provides for punishment by a competent court for manufacture or sale of adulterant or spurious goods.

The Central Consumer Protection Council Rules provide for the constitution of the Central Consumer Protection Council, an advisory body on consumer issues, headed by the Union Minister of Consumer Affairs, Food and Public Distribution with the Minister of State as Vice Chairperson and 34 other members from different fields, the official statement added.

Published on July 20, 2020

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