1. The document discusses how hands-on e-commerce platforms should be in regulating products sold through their marketplaces. It notes that some governments want platforms to take responsibility for issues like VAT payments and food safety, while others see platforms as merely technology facilitators. 2. It argues that if sellers are solely responsible for products, but platforms get penalized when things go wrong, there is an inconsistency. If sellers disappear after an issue arises, buyers have no recourse. Platforms are more likely to be around long-term to handle grievances. 3. Some marketplaces invest more in quality control and earn consumer trust as a result. Regulators should recognize the difference between managed and unmanaged market

1. 1
How hands-off should an e-commerce platform
be?
By
Zubin Poonawalla
A marketplace was just slammed with a fine for a defective phone sold
through its platform. State governments want them to take responsibility
for VAT payments, The Food Safety & Standards Authority of India
(FSSAI), India's food regulator now wants e-commerce companies to
come under its purview. On the other hand, DIPP wants e-Commerce
firms to be no more than technology platforms or facilitators enabling
the buyer & seller to meet.
Now how can the government say that the seller on the platform is
solely responsible for product quality, promotion & customer
satisfaction, & still penalize e-Commerce companies when something
goes wrong on these fronts? If the seller is responsible, there's one
more issue. What happens if the seller vanishes after a transaction
happens? Who does the buyer then go to for redressal? It is certainly
more likely that a registered company is around to take care of
grievances than a seller, who may be an individual.
The truth is that people 'trust' certain marketplaces more, & these
marketplaces invest more in ensuring that their products & sellers &
hence transactions are of a certain quality. There's nothing wrong with
this approach & it is actually consumer friendly. The FSSAI directive is
in this direction. The previous action on bringing e-Commerce
companies under the Consumer Protection Act was also in the same
direction.
But now it suddenly got confusing.
There are unmanaged & managed marketplaces. And it might be good
on the governments part to keep this classification separate from
inventory-led & platform e-Commerce. The steps that eBay took as part
of its evolution, or the launch of TMall tell us that there is consumer

2. 2
demand for more curated managed & quality-assured marketplaces.
We don't want the old stories of stones & mangoes being shipped, do
we? Neither would we as customers like to speak to customer-care
(managed by the marketplace) only to be told we should contact the
seller, who may decide not to entertain us.
The policy-markers have to understand. If the seller is not picking up his
phone, customers would like to pick up their stone - which is bad - what
is worse is not knowing where to throw it.