Harnessing the Digital Giants

As in the case of the new IT rules—aimed at controlling social media majors Facebook, Twitter and WhatsApp, as well as digital news portals like The Wire, Scroll and The Quint—the objective behind the draft e-commerce rules is shadowing

- Shivanand Pandit

TO design the strict structure under which firms function, the government has suggested changes to the electronic commerce rules under the Consumer Protection Act 2020. The amendments suitably underlined using track modifications, go beyond boosting consumer protection per se. The aim appears to be to control dominant players and the government has decided to tighten its rules of e-commerce, taking on overseas titans, such as Amazon and Flipkart-Walmart, in particular, with implications for national retail majors namely Reliance. Nevertheless, numerous industry experts are of the opinion that the new e-commerce draft rules as announced by the government will influence a wide variety of companies, across sectors, comprising the likes of Swiggy, Zomato, BigBasket, Ola, Uber, and several others, raising their compliance burden.

The proposals take birth at a time when big e-commerce marketplaces, such as Flipkart and Amazon India, are being examined by the Competition Commission of India (CCI) for suspected misuse of market supremacy and giving preferential treatment to sellers in the segment wherein they hold indirect stakes. The CCI investigation also concentrates on deep-discounting exercises being carried out by e-commerce marketplaces, which have led to grievances from offline vendors. In June 2021, the Karnataka High Court dismissed Flip - kart and Amazon India’s appeal challenging CCI’s inquiry, stimulating the firms to appeal the order at a Division Bench of the Court for relief.