Draft e-commerce policy seeks tough data rules, fair competition through multiple players

Draft e-commerce policy seeks tough data rules, fair competition through multiple players

The DPIIT has finalised its Draft E-commerce Policy and is set to make it public soon, and has plans to impose tougher rules around data, and seeks to ensure fair competition through multiple players.

The draft policy mentions a regulator for the sector, especially on matters of fair competition and national security. The government has also cited concern over just “one or two strong companies” emerging as leaders and exercising control over the information repository. This draft policy further highlights other challenges when it comes to “law and order, revenue base erosion, privacy, anti-competitive behaviour, consumer protection, counterfeit products, piracy, copyright infringement”.

According to this new draft, companies will have 72 hours to comply with requests for information by the government, and may also be mandated to disclose source code and algorithms if the government seeks it. The policy recommends that the government should ensure there are more service providers available.

The new draft policy covers similar points on data localisation and promoting exports, as the first draft policy released by the government last February. Since then, the government has held multiple discussions with the industry, and is now set to make a final draft public for further industry feedback.

Here are some key points from the draft e-commerce policy.

DATA

– Commerce entities must comply with requests for information by law enforcement agencies within 72 hours

– Important for the Government to reserve its right to seek disclosure of source code and algorithms. This is to ensure no biases or discrimination due to digitally induced biases.

– Government to have speedy access to data flowing on e-Commerce platforms

– Government will retain the right to ask all e-Commerce sites/ apps to provide access to commercially viable/ useful information

– Cross-border flow of potentially commercial data pertaining to defence, medical records, etc. may be restricted

– Government to define categories of e-Commerce that would require mirroring or localization.

– Government to push for data centers in India

– To make India competitive in the area of taxation, cost of power, quality and nature of power, fiber capacity as well as space for data centers.

EXPORTS

– Government will establish dedicated e-Commerce Export Promotion Cells and specialize export support policies for MSMEs

– Government will focus on creation of e-Commerce export zones (EEZ) with common facilities for MSME clusters

– States will be encouraged to have institutional tie-ups with various e-commerce players to enable exports of Indian handicrafts.

CONSUMER PROTECTION

– In this policy, ‘consumer’ includes a person whose personal information is collected or harvested by an e-Commerce entity.

– e-Commerce platforms should provide all the options of products and services available to the consumers without favoring any specific product, supplier or group.

– Personal data acquired by an e-Commerce entity will have to be handled adhering to the provisions of the relevant legislation.

– Any non-personal data of consumers is acquired by an e-Commerce entity, the entity must, through appropriate notification, disclose the reasons for its collection, storage and usage, at the time of collection.

– Display of phone number and email address for consumer grievances is mandatory for all e-Commerce sites

– Details of the sellers supplying the product vide e-Commerce platforms including but not restricted to, telephone number, customer complaint number, email IDs, address etc. should also be provided.

– For goods being imported via e-Commerce entities or being exported from India, the detail of country of origin and value addition done in India should be clearly specified.

– Marketplaces are required to devise mechanisms to prevent fraudulent reviews and ratings by the sellers and their affiliates.

FAIR COMPETITION

– In the interest of the Indian consumer, and the local startup ecosystem, the government will aim to ensure that there are more service providers available

– Govt to ensure network effects do not lead to creation of digital monopolies misusing their dominant market position

– Regulations may provide for greater sharing of information resources to allow a fair chance to all companies to grow and compete.

– e-Commerce companies, which enter into excusive content relation over their platforms tend to have greater control over the content/ goods provided. The intermediary cannot claim exemption from content liability in this case

– All product shipments from other countries to India must be channelized through the customs route. An integrated system that connects Customs, RBI and India Post shall be developed to track imports better.


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