The Central Government may consider establishing an independent regulatory authority for the e-commerce sector, similar to the Securities and Exchange Board of India (SEBI).
The Department for Promotion of Industry and Internal Trade (DPIIT) has launched the Open Network Digital Commerce (ONDC) initiative to democratize digital commerce & move it from a platform-centric model to an open-network model. The Union Minister of Commerce & Industry Piyush Goyal discussed the details while reviewing the initiative.
Details about the ONDC
According to a press release, the government intends to establish an Open Network for Digital Commerce (ONDC). Drawing a parallel, the Minister said that what UPI is to the digital payment domain, ONDC is to e-commerce. It will enable buyers and sellers to be digitally visible and transact through an open network no matter what platform/ application they use.
The network will empower merchants and consumers by breaking down silos to create a single network that will drive innovation and scalability across all industries, including retail, food, and mobility.
Regarding the regulatory authority, it’s goal will be to maintain a level playing field and ensure that the industry remains competitive. It will also ensure that new entrants do not face any hindrances.
In addition, Mr. Goyal declared in the meeting that the ONDC will be compliant with the Information Technology Act, 2000 and the upcoming Personal Data Protection Bill. The regulator will hear complaints from everyone involved including consumers, brick-and-mortar traders, and e-commerce players. It will be one central authority for non-personal data exchanges. It may also have the power to do dispute settlement, and impose penalties. The minister further indicated that ONDC will work not just for products but also for services.
Consumer Protection (e-Commerce) Rules, 2020
Following consultation with industry experts and e-commerce operators, the Central Government said a few days ago that it is considering amendments to the present Consumer Protection (e-Commerce) Rules, 2020. This was to offer more clarity to flash sales and party sales.
According to the laws, e-commerce organisations must ensure that none of their “connected parties and associated enterprises” are listed as vendors on their platforms. Further, no related company shall sell items to another online seller on the same platform.
As per the rules, related parties or affiliated firms should not do anything that the e-commerce entity cannot perform on its own. Further, e-commerce marketplaces must appoint a nodal contact person for 24×7 coordination with law enforcement agencies.
Analogous to the proposed e-commerce regulator, the new laws are in place to bring more oversight to the country’s burgeoning e-commerce market. The rules will also provide a level playing field for both e-commerce giants and small enterprises.