The Consumer Protection Act, 2019 (CPA 2019) enacted by the Parliament recently came into force on 20th July 2020 with the newly notified Consumer Protection (E-Commerce) Rules, 2020 that were notified on July 23rd, 2020 replacing the almost three-decade-old Consumer Protection Act, 1986 (“CPA 1986â€) is the much-needed legal mechanism to tackle the several challenges that are often faced by the consumers especially in online transactions. The act has also introduced several bodies such as Central Consumer Protection Authority (CCPA), the Central Consumer Protection Council, and the three tiers of consumer courts at the district, state and national level. In effect, the new provision aims to provide an easier redressal to the consumers, protect their rights, to keep a thorough check on the functioning of e-commerce entities and for preventing unfair trade practices in e-commerce and direct selling.
The bodies established under the act are:
Central Consumer Protection Authority:
The purpose of this body is to supervise violations of consumer rights, unfair trade practices and selling of deceptive products. The body comprises of a chairperson, five central commissioners and five regional commissioners. The selection is chaired by Niti Aayog members and two secretaries of the central government. The tenure is of five years or 65 years of age, whichever is earlier and the removal of the members maybe done on the basis of insolvency or on recommendation of an inquiry committee for offences, misuse of position etc.
Central Consumer Protection Council:
The purpose of this body is to advise on promotion and protection of consumer rights and further consist of up to 36 members including a Chairperson, a Deputy Chair, Two MPs, two state ministers (by rotation), and Consumer Affairs Secretary with a term of three years.
District Commission (Jurisdiction on disputes up to one crore rupees):
The commission of this body comprises of President and at least two members out of which at least one must be a woman. The term is of five years or until 65 years of age, whichever is earlier. One-time re-appointment is further permitted.
State Commission (Original jurisdiction of one to ten crore rupees and appeals from District):
This committee consists of a President and at least four members. It also it states that not more than 50% of members can be from a judicial background and at least one member must be a woman. The term is of five years or until 67 years of age, whichever is earlier. One-time re-appointment is further permitted.
National Commission (Original jurisdiction above ten crore rupees and appeals from State):
This Commission will comprise of four to 11 members, at least one of which must be a woman. The term is of four years of until 70 years of age; whichever is earlier for the President and four years or 65 years of age; whichever is earlier for the other members.
Liabilities of E-commerce entities
Section 2(16) of the act defines e-commerce as:
"e-commerce" means buying or selling of goods or services including digital products over digital or electronic network. The Draft Rules define an “e-commerce entity†as an entity, in India or abroad, which conducts e-commerce business either through: 1. Inventory-based model- where the entity owns the inventory and sells it to consumer directly, or 2. Marketplace model, where entity acts as a technology platform facilitating transactions between buyers and sellers.
As per the rules the liabilities of the entities include duties such as not to influence the prices of product as stated by the seller, not to adopt unfair methods to influence consumer decisions, fix the terms of the contract between the entity and the seller or service provider, to record counterfeit products by sellers and of deceptive products, ensure that advertisements for marketing of goods and services are consistent with their actual characteristics and usage conditions and to specify warranty and safety information of the goods and services listed for sale.
Liabilities of sellers include having a written contract with the e-commerce entity, providing mandatory safety and warranty and shelf life information, and bearing responsible for warranty or guarantee obligations of goods and services sold.