Draft Guidelines for Ecommerce Platforms

Context:

The Bureau of Indian Standards (BIS) has proposed draft guidelines under the Food and Consumer Affairs Ministry that will look at enhancing consumer protection and building up trust in this fast growing ecommerce sector. The guidelines will look for self regulation by ecommerce platforms aimed at mitigating fraudulent practices while improving transparency within the digital shopping landscape

Key Features of the Draft Guidelines

PreTransaction Stage

• KYC of Business Partners
  • Ecommerce platforms must carry out strict Know Your Customer KYC checks especially for third-party sellers.
• Detailed Product Listings
  • Product listings must include: Clear product titles seller contact information and identification numbers.
    • Supporting media eg images/videos to help consumers judge product utility and features.
• Importer and Seller Details for Imported Goods
  • Platforms must prominently display importer packer and seller information for imported goods to ensure transparency.

Contract Formation Stage

• Consumer Consent
  • Platforms must record and ensure consumer consent before proceeding with transactions.
• Review of Transactions
  • Consumers should be able to view their transactions before they commit purchases.
• Cancellation Returns and Refunds
  • There must be a clear policy on cancellations returns, and refund through transparent timelines and processes.
• Complete Transaction Records
  • The platforms must keep transaction records and have them available according to local regulations.
• Secure Payment Systems
  • Ecommerce platforms are required to implement secure payment methods using encryption and two factor authentication to protect consumer data.
• Payment Methods
  • A variety of payment options including credit debit cards mobile payments ewallets and bank transfers must be made available.
• Disclosure of Processing Charges
  • Any processing charges associated with transactions must be fully disclosed to the consumer.

Post Transaction Stage

• Recurring Payments
  • Platforms must provide clear disclosures on:
    • Duration intervals and amounts for recurring payments.
    • Simple optout procedures for consumers who wish to cancel subscriptions.

• Cash on Delivery Refunds
  • Refunds for cash on delivery orders must be processed according to the consumers preferred method.

Objectives of the Guidelines

• Protecting Consumers
  • Address rising concerns over fraud and misinformation in the ecommerce sector.
• Building Consumer Trust
  • The guidelines aim to establish transparent and secure transactions ensuring that consumers can make informed choices.
• Regulatory Clarity
  • Providing clear rules for ecommerce platforms to govern their operations contributing to a safer digital shopping environment.