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Consumer Protection Act, 2019 comes into force, e-commerce platforms to face the heat for unfair practices

Ram Vilas Paswan, Union Minister for Consumer Affairs, Food & Public Distribution said this new Act will empower consumers and help protect their rights

July 21, 2020 / 10:49 PM IST

Bringing e-commerce companies under the ambit of a structured consumer redressal mechanism, the government on July 20 notified the Consumer Protection Act, 2019, which will be empowered to conduct investigations into violations of consumer rights. It will also give teeth to the authorities to punish unfair trade practices and misleading advertisements.

E-commerce platforms will now have to acknowledge the receipt of any consumer complaint within 48 hours and redress the complaint within a month from the date of receipt.

A significant change that under the earlier Act, complaints could be initiated only in the place where the transaction took place. But now, a consumer can institute a complaint from where he resides.

Ram Vilas Paswan, Union Minister for Consumer Affairs, Food & Public Distribution, said this new Act will empower consumers and help them in protecting their rights through its various notified Rules and provisions like Consumer Protection Councils, Consumer Disputes Redressal Commissions, Mediation, Product Liability and punishment for manufacture or sale of products containing spurious goods.

A significant note for customers under this Act is that there will be no fee for filing cases up to Rs 5 lakh. There are provisions for filing complaints electronically, credit of amount due to unidentifiable consumers to Consumer Welfare Fund (CWF).

The State Commissions will furnish information to central government on a quarterly basis on vacancies, disposal, pendency of cases and other matters, the release said.

He added that under this Act, every e-commerce entity is 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., including country of origin, which are necessary for enabling the consumer to make an informed decision at the pre-purchase stage on its platform.

He said e-commerce platforms have to acknowledge the receipt of any consumer complaint within forty-eight hours and redress the complaint within one month from the date of receipt under this Act. He further added that the New Act introduces the concept of product liability and brings within its scope, the product manufacturer, product service provider and product seller, for any claim for compensation.

Paswan noted that in earlier Consumer Protection Act, a single-point access to justice was given, which is also time-consuming. He said this Act will prove a significant tool in protecting consumer rights in the country.

Relief for consumers

“Very significant change in the law. So far, much of the advertising was left to goodwill. The maximum recourse was given to ASCI but they were paper tigers. ASCI was a convenient subterfuge for companies. For the consumer, it was a very harrowing process for the consumer to take the company to task. ASCI, at best time used to rap the company on the knuckles after a long time and by that time, the advertisement had run its full course. Since government machinery has moved, the power to prosecute or penalise is there now. Whenever law is given teeth, the chances of adhering to discipline increases,” Dr Sandeep Goyal, Chairman, Mogae Media, told Moneycontrol.

Goyal said now the onus is on e-commerce companies and even companies like Facebook will now be liable.

Moneycontrol News
first published: Jul 20, 2020 08:07 pm