Responding to the government’s call for comments on draft e-commerce policy or Consumer Protection (e-commerce) Rules, 2020, think-tanks and research groups have asked for a differential approach towards small and large e-commerce entities.

Last month, the draft e-commerce policy had proposed amendments like fall-back liability on e-commerce companies (companies will be held liable for a registered seller failing to deliver the ordered goods), limited flash sales, appointing an India-based grievance redressal team, compulsory registration with DPIIT (Department of Promotion of Industry and Trade) and a country of origin filter to sort indigenous sellers, among other things.

Researchers at the Centre for Internet and Society (CIS), a Bengaluru-based non-profit, wrote in their recommendations that the compliance obligations for e-commerce companies should be differentiated based on the company’s size and transactions’ volume rather than adopting a ‘one-size-fits-all’ approach which may harm small businesses.

Increased cost of operations

Although, most of the public consultation documents reviewed by BusinessLine welcomed governments’ intention to protect consumer interest. There were concerns about the increased cost of operations and reduced ease of business for e-commerce companies.

“Excessive compliance requirements may end up playing into the hands of the largest players as they would have larger financial coffers and institutional mechanisms to comply with these obligations,” the CIS researchers added.

A Delhi-based public policy think-tank, The Dialogue also suggested that the policy should avoid uniform applicability of the rules as it will hamper the smaller businesses and create an entry barrier. Internet Freedom Foundation also mirrored the views of other policy groups and said that the government should not adopt such a one-size-fit-all approach and instead “impose the compliance obligation only on those entities which have specified turn-over or a large number of active users.”

Further, referring to the amendment mandating e-commerce companies to register with DPIIT, RSS affiliate body Swadeshi Jagran Manch, also said that the government should introduce a threshold for compulsory registration requirement so that the market access of small e-commerce players is not burdened by avoidable compliances.

Commenting on the other proposed change in the draft, Anita Gurumurthy, Director of IT for Change said that they welcomed the proposed ban on flash sales by e-commerce platforms in the draft rules, as such practices are an abuse of market power and create huge distortions in the playing field. “We also appreciate the express prohibition on e-commerce entities from disclosing the personal information of consumers to third parties – a welcome move that is important from a data privacy perspective,” she added.

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