The Indian Information Technology Act provides legal recognition for e-records and e-signatures, which facilitates e-commerce. Some legal issues that may arise for e-commerce players in India include the validity of e-contracts, data protection, intellectual property rights, competition compliance, and adherence to consumer protection laws regarding returns and required disclosures. Frequent improvements to laws and regulations aim to balance consumer experience with compliance requirements for e-commerce businesses.

1. LEGAL ASPECT PERTAINING
TO E-COMMERCE

2. E-Commerce Legal Issues
 Electronic commerce or e-commerce legal issues industry
in India has come a long way since its early days and
has been growing rapidly across the world. The industry
has matured and has seen the entry of many new
players in the market. India is considered as a
profitable market for these e-commerce businesses.
 E-commerce refers to a wide range of online business
activities related to a variety of products and services.
It is where in the business transactions, the parties
interact electronically and not by physical exchanges or
direct physical contact, which are more traditional
methods of business.

3. What provision does the Indian Information Technology Act
have for e-commerce?
 The Indian Information Technology (IT) Act provides
legal recognition to the e-records and e-signature,
which are the foremost steps to facilitate e-
commerce.
 Under this Act, the Ministry of Electronics &
Information Technology (MeitY) has proper rules laid
down for reasonable security practices and
procedures as well as for sensitive personal data
and information.

4. What are the Legal Issues that May Possibly Arise for the E-
Commerce Players in India?
 1. E-Contracts
Both the Indian Contract Act and the IT Act must be
read in conjunction to understand the legal validity of
e-contracts. Thus, e-contracts are governed by the basic
principles of a valid contract that mandates that the
contract must be entered in with free consent and a
lawful consideration between two competent parties.
Also, Section 10A of the Information Technology Act,
2000 (“IT Act”) provides the validity of the e-contracts.

5. 2. Data Protection
 Security of the information provided during an online
transaction is a major concern.
 The Information Technology (Reasonable security
practices and procedures and sensitive personal data
or information) Rules, 2011 and the Section 43A of the
IT Act together provide a structure and guidelines for
the protection of data in India.
 It is required of the Company to take all reasonable
precautions to prevent any corruption, damage, loss or
destruction of the private information and/ or data,
even upon the termination of the contract between the
parties.

6. 3. Intellectual Property Rights
 E-commerce websites are designed and sometimes
operated by other parties specializing in the field.
Often the content is also managed by a third party.
Thus, unless the agreement between the parties
specifically provides the IP rights, there is a
possibility of infringement subject to the trademark,
copyright or patent on an online platform

7. 4. Competition
 E-commerce legal issues have seen a generation of
new players and the merging and acquisition
between several old players. This has enabled
development of new services, distribution channels
and far greater efficiency in business activities than
ever before. This development has the possibility of
leading to certain competition issues with respect to
the development of strategies for growing the
network and maintaining their market power.

8. 5. Other things to look out for
 Ensure proper online contracts
 Original documentation in relation to taxation
 Record retention obligations
 Exchange control regulation
 Import-export regulations
 Foreign data protection law
 Terms and conditions must be specific depending upon
the nature of the goods & services offered and not
generic.
 Reasonable efforts to prevent the unauthorized
transaction

9. 6. Return policy
 The Law on the consumer protection which regulate
the sales in e-commerce contains an unambiguous
provision for the right of every costumer to return
the purchased goods within seven days term after
the delivery. The law does not require the presence
of defects or inconsistency in the good quality;
neither any reason for return has to be mentioned

10. 7. Terms and conditions, required information
 E-commerce site must contain certain information
that is expressly referred to the Law on Consumer
Protection. These duties include providing
information to the user regarding the name and the
address of the provider, the general characteristics
of the commodities/services, the price of the
commodities/services, including all taxes and fees,
the cost of postal or transport charges, which are
not included in the price of the
commodities/services

11. 8. Copyright Protection Issue
 While publishing content for your e-commerce
website, using content of any other company can be
a severe legal problem. This might mark an end to
your e-business. There are many sites online which
are royalty free and allow you to access their
content and images. You may use those sites for
creating web content for your business site.
 Even if you unintentionally used copyrighted content,
the other party can easily sue your business.

12. Conclusion
 The frequent improvement in the laws and rules and
regulations shall make the e-commerce legal issues
marketplace a pleasant experience for the
consumers. Though the laws are being made more
stringent for the e-commerce players yet it shall
ensure its growth and increased investments.