On February 19, the government said it would frame rules and implement the new Consumer Protection Act, which would be replacing the over three-decade-old version of the Consumer Protection Act, 1986. With the Act being notified on July 20, these are some key features of the new law:
Setting up of a specialised body to look into consumer matters
- The bill proposes setting up of a body that will look to promote, protect, and enforce the rights of the consumer.
- The Central Consumer Protection Authority (CCPA) can make interventions and also protect the consumer from receiving any detriment arising from any unfair trade practices. It would also be given the power to initiate class action, which includes forcing recall, refund, and return of products. e-commerce platforms have to acknowledge the receipt of any consumer complaint within 48 hours and redress the complaint within one month from the date of receipt under this Act, said Ram Vilas Paswan, Minister of Consumer Affairs, Food and Public Distribution.
Speedier mediation
The bill also envisions a speedier mediation process. It intends to achieve this through the following:
- The consumer can approach their nearest commission under the jurisdiction of which they reside.
- Consumers can file complaints from anywhere and do not require a lawyer to represent their case.
- There will also be a fixed timeline in the rules for mediation cases.
Misleading advertisements
- For the first time, there will be an exclusive law on product liability. As a result, the manufacturer or product service provider or product seller will now be responsible to compensate for injury or damage caused by defective products or deficiency in services.
- There is also a provision for a jail term and fine for manufacturers who are found using misleading advertisements.
- While there is no specific jail term for celebrities who participate in these advertisements, they can be banned from endorsing the product in question if it is found to be misleading.
Provision for class-action lawsuits
- The new Consumer Protection Bill creates provision for a class action lawsuit, where the authority has the power to slap a penalty on a manufacturer or an endorser up to Rs 10 lakh and imprisonment for up to two years for false or misleading advertisements. This is done to ensure that the rights of a consumer are not infringed upon.
The Bill also enables regulations to be notified on e-commerce and direct selling, with a focus on protection of consumer interest.
e-commerce entities Every e-commerce entity will now be required to provide information relating to return, refund, exchange, warranty and guarantee, delivery and shipment, modes of payment, grievance redressal mechanism, payment methods, security of payment methods, charge back options, etc. This also includes country of origin, which is necessary for enabling the consumer to make an informed decision, at the pre-purchase stage on its platform.
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