Consumer Protection in Digital Services

The Consumer Protection Act, 2019 protects people who obtain digital services for consideration, including through online transactions. It regulates a provider’s unfair trade practices, misleading advertisements and deficient services, while generally excluding services rendered entirely free of charge.

Coverage and prohibited conduct

Under Section 2(7), the definition of consumer expressly covers transactions conducted through electronic means. Section 2(47) defines unfair trade practices broadly enough to cover deceptive conduct in digital markets.

• False claims about a service’s quality, benefits, price or approval, and misleading advertisements, can constitute unfair trade practices.
• Failure to issue a bill, refusal to refund or withdraw a deficient service under the prescribed conditions, and unjustified deceptive pricing may attract liability.
• Disclosure of a consumer’s confidential personal information is an unfair trade practice unless permitted by law.

Digital-specific obligations

The Consumer Protection (E-Commerce) Rules, 2020 apply to goods and services, including digital products, sold through electronic networks. The Guidelines for Prevention and Regulation of Dark Patterns, 2023 prohibit deceptive interface practices that impair consumer choice and amount to an unfair trade practice, misleading advertisement or violation of consumer rights.

• E-commerce entities must appoint a grievance officer, acknowledge complaints within 48 hours, and redress them within one month.
• Consumer consent must be expressed through an explicit affirmative action; consent cannot be automatically recorded through pre-ticked boxes.
• An entity cannot impose cancellation charges on consumers unless it bears similar charges when it cancels unilaterally.

Enforcement and remedies

The Central Consumer Protection Authority can investigate practices affecting consumers as a class and order their discontinuance. It can also direct reimbursement, recall unsafe goods or withdrawal of unsafe services, and act against misleading advertisements.

• Consumer Commissions may order refund, compensation, removal of service deficiencies, discontinuance of unfair practices and corrective advertisements.
• Consumers may file complaints electronically, while mediation provides an additional route for consensual settlement.