Amazon Brings CCPA to Delhi HC for Instruction and Sanction Order for Standards Violation

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Amazon has filed a case against the Central Consumer Protection Authority (CCPA) in the Delhi High Court challenging an order that found the e-commerce platform violated mandatory standards for the sale of pressure cookers.

The regulator at the Ministry of Consumer, Food and Utilities had issued an order in August, imposing a fine of Rs 1 lakh on the local branch of the Seattle-based e-commerce company for violating the Bureau of Indian Standards (BIS) standards. for products sold on its marketplace.

This may be the first time Amazon has sued a government department. Late last year, he had approached Delhi HC seeking relief from the Enforcement Directorate (ED) over an investigation related to his investment in a Future Group company.

Amazon Seller Services, the marketplace arm of Amazon India, dragged the CCPA to Delhi HC last month, but the matter has yet to be reported.

Amazon, in its attempt to seek interim relief from the court, argued that it had not been informed of the content of a CCPA investigation, nor had it been given an opportunity to respond to allegations.

The e-commerce company also argued that it had not received the report on the basis of which the CCPA imposed the sanction on it and that the collection of the same under section 20 of the 2019 law on consumer protection had no competence in law.

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Legal representatives for the CCPA refuted Amazon’s allegations, according to a court order reviewed by ET, and said the investigation had been duly undertaken and prosecution had been initiated by the CCPA based on the court’s findings. ‘investigation.

The consumer protection authority also said that Amazon had not provided any evidence that sellers on its marketplace offered products that complied with BIS standards and that it could not “claim a right to ship products”. sellers without ensuring that their products comply with applicable legal requirements.”

Amazon India did not respond to ET’s email seeking comment on the matter until press time on Sunday.

Generally, online marketplaces argue that while they have some process to verify what a seller is offering on the platform, the ultimate responsibility lies with the individual trader selling the goods on a e-commerce platform.

Industry insiders said retailers like Amazon believe this is an issue where manufacturers need to be investigated and told to comply, instead of online marketplaces.

In its August order, the CCPA said that Amazon admitted to collecting “sales commission” fees for pressure cookers sold on its platform and that when it earns commercially on each sale of the product listed on its platform of e-commerce, he could not dissociate himself in the event of problems arising from the sale of products through his platform.

Amazon vs Central Consumer Protection Authority_Graphic_ETTECH

Paytm Mall was also given a similar penalty for defective pressure cookers, but the e-commerce company complied with the CCPA directive and deposited the penalty money.

The High Court observed that on the face of it the investigation showed that the pressure cookers in question were not BIS certified, but also that Amazon appeared to have had no opportunity to refute or respond to these findings. According to the court, it should also “consider the duties and obligations that an e-commerce entity must be held responsible for performing in law before onboarding a seller.”

These and other questions merit further consideration, the court noted in its order. The case is scheduled for its next hearing in November.

Amazon has been advised that it is required to notify consumers of the 2,265 pressure cookers sold on its platform as per the CCPA order, but the recall of those items and refunds will be suspended until the next date.

The e-commerce company is asked to submit Rs 1 lakh to the Registrar General of the court.

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