New Delhi, Sep 2: The Central Consumer Protection Authority (CCPA) has raised concerns over the online sale of regulated and hazardous substances, saying e-commerce marketplaces must put adequate verification and due-diligence mechanisms in place before allowing such products to be listed or purchased.
The Authority’s observations came during its examination of online marketplace Dial4Trade in connection with the sale of Ammonium Nitrate through its platform.During the proceedings, Dial4Trade maintained that it operated as a business-to-business (B2B) marketplace.
The CCPA, however, did not accept the argument, noting that the platform allowed the substance to be offered in quantities as small as a single unit.The Authority also pointed to the absence of mechanisms such as minimum purchase requirements and verification of institutional buyers, which it considered relevant safeguards for a genuine B2B model involving regulated substances.
The CCPA further held that the Consumer Protection (E-Commerce) Rules, 2020 are applicable to marketplace e-commerce entities and that the applicability of the rules cannot be determined solely by the business model claimed by a platform.
The Authority also examined Dial4Trade’s reliance on intermediary protection under Section 79 of the Information Technology Act, 2000. It observed that such protection is linked to compliance with prescribed due-diligence obligations.
According to the CCPA’s findings, merely removing a listing after it comes to the platform’s notice does not constitute sufficient preventive action when the products involved are hazardous or subject to regulatory controls.The Authority also took note of the platform’s ability to suspend sellers and remove product listings.
This, it said, demonstrated that the marketplace had mechanisms to exercise control over content and products offered through its service.
The proceedings form part of a wider CCPA examination into the online availability of hazardous chemicals, explosive substances and related precursors. The substances under scrutiny include Ammonium Nitrate, Gun Powder, Picric Acid and Pentaerythritol Tetranitrate (PETN).
Other platforms mentioned in the ongoing examination include IndiaMART, Justdial, Sigma-Aldrich India, Exporters India, Ibuychemikals, Alpha Chemika and TradeIndia.The CCPA stressed that Ammonium Nitrate is a regulated substance and that its unauthorised sale or possession without required safeguards can raise public-safety concerns.
The Authority said online marketplaces need to exercise appropriate caution when dealing with regulated products because buyers may rely on product descriptions and listings while making purchase decisions.
The latest action underscores the regulator’s focus on strengthening compliance in the e-commerce sector and preventing unfair trade practices, particularly where online listings involve substances that are subject to heightened safety and regulatory requirements.
