Why the new ‘Digital Commerce Operation Guidelines’ needs major revisions?

In response to the growing impact of digital platforms on the country's current economic successes and the challenges, the Ministry of Commerce enacted 'Digital Commerce Operational Guidelines' (hereinafter the guidelines) on July 4 this year. The guidelines have been prepared under the National Digital Commerce Policy, 2020. The new guidelines have brought e-commerce operations under the direct inspection of the government. Its goal is promoting transparency, accountability, and consumer protection in digital commerce operations as well as taking measures to increase and ensure consumers' confidence and rights by bringing discipline into the digital commerce operations.

The newly framed guidelines purport to put an end to the fraudulent transactions. The long-awaited guidelines focus on banning Multi-Level Marketing (MLM) businesses through digital or e-commerce platforms, prohibiting online gambling, requiring a license in the case of buying and selling medical goods, protecting personal data, and requiring a Unique Business Identification Number (UBID) for every marketplace. For protecting the customers from misleading purchases, the rules suggest that products presented online to the buyers should have a clear description for the consumer so that buyers can have a realistic understanding of what they are buying.

That said, these new guidelines failed to incorporate a few necessary instructions, without incorporation of which, it may fail to measure up to the expectation the policymakers had had while outlining it.

One of the major loopholes of the new guidelines is that although the guidelines provide instructions for complaints, it fails to mention detailed instructions and procedures following a complaint by a customer. To resolve such complaints, resorting to the Consumer Rights Protection Act, 2009 (CRPA) can be the appropriate remedy, which the instrument itself also mentions in its guideline no. 3.4.6.

But the main hindrance, in this case, is that the CRPA does not apply to online transactions. To overcome this obstacle, section 2(11) of the CRPA should be amended to incorporate the phrase 'online or offline'. With the introduction of this simple amendment, it will be easier for the concerned authorities to provide the proper remedy of complaints arising out of online business, and that too within existing legislative frameworks. It is pertinent here that, India has, in order to protect the rights of the consumers in the digital platform, enacted a new Act titled Consumer Protection Act, 2019. The term 'online' has been included in that statute through explanation (b) of Section 2(7) of the instrument.

Even though the guidelines in the 'Aim and Purpose' chapter cues as to its commitment towards achieving a competitive e-commerce market, it (somehow consciously) omits to put a cap on the excessive discount or predatory pricing. In recent years, the e-commerce market has seen platforms like Evaly and Alesha Mart offering products with predatory price tags and with luring cashback offers, which in turn caused customers to wait for a period of 3-4 months to get the products or in worse cases, not to get them at all. Moreover, these practices forced many new and long-standing e-commerce platforms to downsize their operations and sustain losses despite providing better service. Hence, in order for the market to be competitive and less manipulated into the hands of some, the guidelines should come up with a ceiling for cashback and pricing. Otherwise, we would only spectate a rather manipulative and uncompetitive market that militates not only against the competition in the market but also the rights of the consumers.

Another concept that can be incorporated from the newly drafted stringent e-commerce policy of India is the idea to promote local products in preference to foreign ones. This can be accomplished by recommending, wherever possible, local alternatives each time a consumer looks at an imported good or service. This action will promote the 'made-in Bangladesh' tags and encourage the local brands to make better quality products that comply with international standards.

Furthermore, the new guidelines are completely silent on the cross-border e-commerce policy issue. It should be mentioned that on the recent United Nations Conference on the Trade and Development's (UNCTAD) Business-to-Consumer (B2C) E-commerce Index 2020, Bangladesh ranked 115th, slipping 12 notches from its previous position. It is the most significant regression among the South Asian countries.

According to UNCTAD, the percentage of people who use the internet, the share of people who use a financial account, the surety of secure servers, and postal reliability are the four factors to assess a country's e-commerce progress. Bangladesh lags in all of these sectors. The absence of a cross-border e-commerce policy is the primary cause of this shortfall as non-expansion of local e-commerce beyond the frontiers play counterincentive role in the fulfilment of these criteria.

Henceforth, to advance thoroughly in this field of digital commerce globally, Bangladesh must evaluate the criteria mentioned above and revise the guidelines appropriately to cope up with the challenges. If these efforts become successful, the future of e-commerce will undoubtedly flourish and sail us towards a robust economy.

The writers are law students, University of Rajshahi and University of Dhaka respectively.