E-Commerce Compliance Checklist for Indian Startups: What the Consumer Protection Rules Actually Require

Written by: Prakhar Rai, Advocate | Founder, My Legal Pal | Enrolled with the Bar Council of India

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Quick answer

If you sell anything online to Indian consumers, the Consumer Protection (E-Commerce) Rules, 2020 apply to you, whether you run a marketplace, sell your own inventory directly, or sell through someone else’s platform. The rules require specific disclosures on your platform, a working grievance redressal process, a ban on manipulative practices like pre-ticked consent boxes, and fair treatment of cancellations and refunds. Which exact obligations apply to you depends on your business model, so the checklist below is split by model. If you are not sure which one you are, the quick test is this: do you own the inventory you sell, or do you provide the platform for other sellers?

Which rules apply depends on your model

The Rules recognize that an online business is not one single thing, and they set different duties for different setups.

A marketplace provides the technology platform that connects buyers and sellers, without owning the inventory itself. Think of a platform where multiple brands or sellers list products.

An inventory e-commerce entity owns what it sells and sells it directly to consumers. A D2C brand selling only its own products through its own website or app falls here.

A seller is a business or individual selling goods or services through someone else’s marketplace, rather than running the platform itself.

Some businesses are a hybrid, running their own inventory alongside third-party sellers on the same platform. If that is you, you likely carry obligations from more than one category, so read all three sections below rather than just one.

What every e-commerce entity must do, regardless of model

These apply whether you are a marketplace, an inventory-based seller, or anything in between.

Display clear information on your platform. Your legal name, the geographic address of your headquarters and branches, your website details, and contact information for customer care and your grievance officer all need to be visible and accessible, not buried in a footer link three clicks deep.

Appoint a grievance officer. This person has to acknowledge a consumer complaint within 48 hours and resolve it within one month. Their name, contact details, and designation need to be displayed on your platform.

Do not use dark patterns to collect consent. Consent for a purchase has to come from an explicit, affirmative action. Pre-ticked checkboxes that assume consent are specifically prohibited.

Do not charge unfair cancellation fees. If you charge consumers a fee for cancelling after a confirmed purchase, you have to apply the same fee to yourself if you cancel an order unilaterally. One-sided cancellation penalties are not allowed.

Process refunds within a reasonable time, following whatever timeline applies under RBI rules or other applicable law for the payment method used.

Do not manipulate prices or discriminate between consumers. Charging different prices to different consumers of the same class, or inflating prices to extract unjustified profit given market conditions, is prohibited.

This baseline set of obligations is also where your terms and conditions earn their keep. Several of these disclosures, the grievance process, the consent language, the cancellation policy, are the kind of thing that needs to actually be written into your platform’s terms, not just followed informally. My Legal Pal’s terms and conditions drafting service is built to cover exactly this, with DPDPA, GDPR, and CCPA awareness built in where relevant.

If you run a marketplace

On top of the baseline obligations above, marketplaces carry additional duties under the Rules.

Require sellers to confirm, through an undertaking, that product descriptions, images, and listed details are accurate
Display seller information clearly: business name, registration status, address, customer care number, and any ratings or feedback, so buyers can make an informed decision before purchasing
Provide a ticket number for every complaint so consumers can track its status
Disclose information on returns, refunds, exchanges, warranties, delivery, and payment methods clearly on your platform
Publish, in plain language, the main parameters that determine how products or sellers are ranked on your platform
Disclose in your seller-facing terms if you give any seller or product category differentiated treatment compared to others in the same category
Maintain records to identify sellers who have repeatedly had listings removed for IP or Information Technology Act violations, even though you are not required to terminate them for this alone

If you sell your own inventory (D2C brands)

Inventory-based entities have duties that mirror the marketplace rules in spirit but apply directly, since there is no separate seller in the picture.

Display accurate information on returns, refunds, exchanges, warranty, delivery, and payment methods
Disclose all mandatory notices required under applicable law
Show the total price as a single figure, with a clear breakup of delivery charges, handling charges, and applicable taxes
Provide a trackable ticket number for complaints
Do not pose as a consumer to post reviews about your own products, and do not misrepresent their quality or features
Keep your advertising consistent with your product’s actual characteristics
Accept returns and process refunds for defective, deficient, or misrepresented goods, rather than refusing on technicalities
If you vouch for or guarantee the authenticity of what you sell, you carry liability if that turns out to be false

If you sell on someone else’s marketplace

If you are a seller operating through a marketplace rather than your own platform, you have your own, separate obligations.

Have a written contract with the marketplace before listing or selling through it
Appoint your own grievance officer, with the same 48-hour acknowledgment and one-month resolution standard
Keep your advertising accurate and consistent with your actual product
Provide the marketplace with your legal name, address, website, email, customer care contact, and GSTIN and PAN where applicable
Disclose a single total price with a clear breakup, accurate return and refund terms, and country of origin information where relevant
Do not refuse to honor returns, exchanges, or refunds for defective or misrepresented goods, except where late delivery is genuinely due to force majeure

A related compliance point worth knowing

Country of origin labeling for products sold online has also been getting more attention, with a proposed amendment that would require e-commerce platforms to add searchable, sortable country-of-origin filters. We cover that specifically in our guide to the mandatory country of origin filter requirements for e-commerce platforms, since it is a distinct, newer requirement layered on top of the baseline Rules covered here.

If your checkout or onboarding also collects personal data, which almost every online business does, that triggers a separate compliance layer under India’s data protection law. Our DPDP Act guide covers that in full if you want to look into it.

Mistakes that show up most often

Treating the grievance officer requirement as a formality. A name on a page without an actual, working process behind it does not satisfy the 48-hour and one-month timelines, and it shows the first time a real complaint comes in.

Using a pre-ticked box anywhere in checkout. This is explicitly prohibited, and it is one of the more commonly missed violations because it is often inherited from a template or a third-party checkout plugin without anyone checking.

Charging a cancellation fee without applying it both ways. If your policy penalizes a customer for cancelling, it has to penalize you the same way if you cancel on them.

Assuming marketplace obligations and seller obligations are the same thing. They overlap but are not identical. If you operate as both, each role brings its own checklist.

Not reflecting any of this in your actual terms and conditions. A compliant internal process means little if your public-facing terms do not actually say what the law requires them to say.

Frequently asked questions

Do the Consumer Protection (E-Commerce) Rules, 2020 apply to a foreign company selling to Indian consumers? Yes. The Rules apply to any e-commerce entity that systematically offers goods or services to consumers in India, even if the entity itself is not established in India.

What is the difference between a marketplace and an inventory e-commerce entity under these Rules? A marketplace provides the technology platform connecting buyers and sellers without owning the inventory sold on it. An inventory e-commerce entity owns the goods or services it sells and sells them directly to consumers, which is the typical structure for a D2C brand.

How quickly does a consumer complaint need to be resolved? The grievance officer has to acknowledge a complaint within 48 hours and resolve it within one month from the date of receipt, regardless of whether you are a marketplace, an inventory-based seller, or a seller on someone else’s platform.

Are pre-ticked consent checkboxes actually illegal under these Rules? Yes. Consent for a purchase must come from an explicit, affirmative action by the consumer. Recording consent automatically, including through pre-ticked checkboxes, is specifically prohibited.

If I sell through a marketplace, do I still need my own terms and conditions? Yes. A written contract with the marketplace is one requirement, but it does not replace your own obligations around accurate advertising, pricing disclosure, and grievance handling, all of which should be reflected in your own customer-facing terms.

If you are setting up or auditing e-commerce compliance

Getting this right at launch is considerably easier than fixing it after a complaint or a notice. Our team can review your current setup, draft or update your terms and conditions to reflect what your specific model actually requires, and advise on the marketplace, D2C, or seller obligations that apply to you. Start with our e-commerce lawyer in India service for a model-specific compliance review.

Related reading:

This article is general information, not legal advice. The Consumer Protection (E-Commerce) Rules, 2020 may be supplemented or amended by further notifications. For advice on your specific business model and compliance position, speak to a qualified lawyer. Authored and reviewed by Prakhar Rai, Advocate, founder of My Legal Pal, enrolled with the Bar Council of India.

Regulatory Compliance, Startup & Founders