Govt. moots proposal to ban ‘flash sales’ on e-commerce sites

We’re receiving complaints against widespread cheating and unfair trade practices, says Ministry

June 21, 2021 10:30 pm | Updated November 30, 2021 06:16 pm IST - New Delhi

Photo used for representation purpose only. File

Photo used for representation purpose only. File

To monitor the deep discounts offered on e-commerce websites, the government on Monday proposed changes to the Consumer Protection (e-commerce) Rules 2020, banning all “flash sales”.

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The proposed changes have been put up on the website of the Ministry of Consumer Affairs calling for public comments till July 6.

The Ministry clarified that the ‘conventional’ flash sale has not been banned. Only ‘predatory’ ones will be banned though the proposed rules leave a lot of grey area. The Ministry of Consumer Affairs, in a statement, said it has been receiving several complaints against widespread cheating and unfair trade practices being observed in the e-commerce ecosystem.

“Conventional flash sales by third party sellers are not banned on e-commerce platform. But certain e-commerce entities are engaging in limiting consumer choice by indulging in ‘back to back’ or ‘flash’ sales wherein one seller on a platform does not carry any inventory or order fulfilment capability but merely places a ‘flash or back to back’ order with another seller controlled by platform. This prevents a level playing field and ultimately limits customer choice and increases prices,” the Ministry said.

It was not clear if this meant suspension of the big festival sales on the sites.

The Ministry has also directed the e-commerce sites to ensure appointment of Chief Compliance Officer, a nodal contact person for 24x7 coordination with law enforcement agencies, officers to ensure compliance with their orders and Resident Grievance Officer. This would ensure effective compliance with the provisions of the Act and Rules and also strengthen the grievance redressal mechanism.

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