PRINCIPLES & GUIDELINES FOR E COMMERCE SECTOR

GS2 GOVERNANCE 

This draft outlines a comprehensive set of principles and guidelines for the self-governance of the e-commerce sector, with the goal of fostering an ethical and responsible e-commerce ecosystem. The proposed framework is divided into three main phases: Pre-Transaction, Contract Formation, and Post-Transaction.

Key Principles:

Pre-Transaction Principles:

• Seller Authenticity: E-commerce platforms must verify the authenticity of sellers, providing details about their place of business, key managerial personnel, financial status, etc.
• Information Disclosure: E-commerce entities must disclose essential information about products and services, including:
  • Product/Service Descriptions
  • Final Consumer Price
  • Cancellation/Exchange/Return Policies
  • Safety Warnings
  • Seller Information
  • Country of Origin

Contract Formation Principles:

• Informed Consent: Consumers’ consent must be explicit and informed, not obtained through pre-ticked checkboxes.
• Transaction Review: Consumers should be allowed to review the transaction before making the final payment.
• Transparent Policies: Policies for cancellations, returns, and refunds should be clear, specifying applicable charges and time limits.
• Secure Transactions: Payment systems should be secured with encryption and two-factor authentication, and complete transaction records should be maintained.

Post-Transaction Principles:

• Return/Exchange/Refund Process: E-commerce platforms should provide a simple and clear process for returns, exchanges, and refunds, with:
  • A single point of contact (e.g., toll-free number),
  • Estimated resolution times, and
  • A grievance officer.

General Principles:

• Prohibition on Banned Products: E-commerce entities must ensure that they do not facilitate the sale of banned products through effective monitoring and seller background checks.
• Fair Business Practices: Platforms should engage in fair practices, including the non-preferential treatment of sellers and adherence to packaging norms.
• Intellectual Property: There should be mechanisms in place to report counterfeit products and address intellectual property rights violations.

E-commerce Sector in India:

• Growth Potential: The Indian e-commerce market is projected to reach US$ 325 billion by 2030.
• In FY 2023, the sector achieved a Gross Merchandise Value (GMV) of US$ 60 billion, marking a 22% growth from the previous year.

Policy Support:

• Foreign Direct Investment (FDI):
  • 100% FDI is allowed in B2B e-commerce.
  • 100% FDI is also permitted under the automatic route in the marketplace model of e-commerce.
• The Government of India aims to achieve $200-300 billion in e-commerce exports by 2030.

This draft aims to create a robust, transparent, and ethical environment for consumers, sellers, and e-commerce entities, ensuring fair competition and consumer protection within India’s rapidly growing e-commerce sector.