Why E-commerce Platforms Could Now Be Liable For Seller's Fraud
Do you often buy stuff on e-commerce websites that is of poor quality but the seller refuses to take any responsibility? The new rules might change that.
The Ministry of Consumer Affairs (MCA) is planning to issue rules that would hold e-commerce platforms like Amazon and Flipkart liable for fraud committed by sellers on their platforms, according to a report in The Economic Times.�
In simpler terms, the government wants to ensure that the e-commerce platforms take the onus of any fraud or malicious operations that one may encounter.
Why is this happening?
We often buy stuff on e-commerce websites that ends up being of poor quality or not matching the description that was there on the product page. When we follow up with the e-commerce website, we are told that the seller is a "third party" and lies outside the purview of the e-commerce platform. The Government wants to curb this and ensure that the e-commerce company is fully liable for all products sold on the website and is also the 'owner' of the product.
This is why, this rule might further demand 'related party' or ‘associated enterprises' of internet marketplaces to not sell products or services to a registered merchant on th...
The Ministry of Consumer Affairs (MCA) is planning to issue rules that would hold e-commerce platforms like Amazon and Flipkart liable for fraud committed by sellers on their platforms, according to a report in The Economic Times.
In simpler terms, the government wants to ensure that the e-commerce platforms take the onus of any fraud or malicious operations that one may encounter.
Why is this happening?
We often buy stuff on e-commerce websites that ends up being of poor quality or not matching the description that was there on the product page. When we follow up with the e-commerce website, we are told that the seller is a "third party" and lies outside the purview of the e-commerce platform. The Government wants to curb this and ensure that the e-commerce company is fully liable for all products sold on the website and is also the 'owner' of the product.
This is why, this rule might further demand 'related party' or ‘associated enterprises' of internet marketplaces to not sell products or services to a registered merchant on their platform.
Why have these platforms not been held responsible so far?
Up until now, e-commerce platforms were protected by provisions prescribed in Section 79 of the Information Technology Act, 2000, which details who and what is exempted from the liability of intermediaries in certain cases.
When will the rules be issued?
The Ministry of Electronics and Information Technology (MeitY) has shared certain queries on the issue with several e-commerce firms. Once they respond, the consumer affairs ministry will take the final decision. However, it has not been made clear if the two parties need to come to a mutual decision for the rules to be implemented.
