Last week, the Indian government released its second Draft National e-Commerce Policy, which is open for stakeholder comments.

The document outlines anti-counterfeiting measures which would oblige platforms to work with trademark owners to ensure the authenticity of items sold. In cases of “high value” goods, the platform would need prior authorization from the trademark owner to list a product. The document also includes anti-piracy provisions including automatic takedowns, and the listing of “rogue websites” which are to be denied financial services, search engine listings, and advertising revenues.

The full document is available here:
https://dipp.gov.in/whats-new/draft-national-e-commerce-policy-stakeholder-comments

The sections on anti-counterfeiting and anti-piracy are copied below:

(C) Anti-Counterfeiting Measures

e-Commerce players would be required to undertake the following measures:

3.9 Seller details should be made available on marketplace website for all products. This shall include the full name of the seller(the name of the legal entity), address and contact details including email and phone number.

3.10 Sellers must provide an undertaking to the platform about genuineness of products they are selling and the same must be made accessible to consumers.

3.11 Trade mark (TM) owners shall be given the option to register themselves with e-commerce platforms. Whenever a trade-marked product is uploaded for sale on the platform, the platform shall notify the respective TM owner. This facility shall be put in place by platforms and made
available for interested TM owners.

3.12 In case TM owners so desire, e-commerce platforms shall not list/ offer for sale,any of the owners’ products without prior concurrence. However, in case TM owners choose to opt for this, they would have to undertake to respond to platforms within a certain time limit.

3.13 In case of specified high value (luxury) goods, cosmetics or goods having impact on public health, marketplaces will be required to seek TM owner’s authorization (that is, authorized/distributor/reseller agreement) before listing the product.

3.14 In case a complaint is received about a product being fake/counterfeit, the same shall be conveyed within 12 hours to the owner of the TM. If the owner of a TM informs the platform about the product being sold on its platform to be counterfeit, it shall notify the seller and if the seller is unable to provide evidence that the product is genuine, it shall take down its listing
and notify the TMowner of the same, as per the provisions of law;

3.15 The platform shall enter into an agreement with each of the sellers on its platform, under which it shall obtain guarantee of authenticity and genuineness of the products sold by the seller, and also provide for consequences of violation of the same. It shall also seek a guarantee from the sellers that the product has not been impaired in any manner and that all warranties and guarantees of the brand owner are applicable and shall be honoured accordingly. Products of any sellers who are unable to provide such a guarantee shall not be listed on the platform.

3.16 Though post-sale, delivery of goods to the customers and customer satisfaction will be responsibility of the seller,there is a caveat to this. Since counterfeiting is a major concern, in case a customer makes a complaint to that effect, marketplaces would have liability to return the amount paid by the customer. In addition, the marketplaces shall cease to host the counterfeited product on their platform, thereby taking down every information related to the product.

3.17 Marketplaces should provide for creation of financial disincentivesfor sellers if found to be selling counterfeit products. In addition, if a seller is found to be selling counterfeit products, the marketplace should blacklist that seller from selling on its platform for a specified period.

(D)Anti-piracy measures

Online distribution of pirated content is a matter of serious concern.The following are strategies proposed to be put in place to tackle this.

3.18 Intermediaries shall put in place measures to prevent online dissemination of pirated content. Intermediaries shall identify ‘trusted entities’, whose complaints are resolved on priority. The identification of trusted entity and anti-piracy measures shall be done on a voluntary basis.

3.19 Upon being notified by the owner of copyright protected content/ work that a website or e-commerce platform is making available, selling or distributing the copyrighted content/ work without the prior permission/authorization of the owner, such website or platform should expeditiously remove or disable access to the alleged content.

3.20 A body of industry stakeholders will be created that shall identify ‘rogue websites’. Rogue website would refer to those that host predominantly pirated content. After verification, these rogue websites shall be included in the “Infringing Websites list’. This shall invite the following:

a) Internet service providers shall remove or disable access to the websites identified in the IWL within set time-lines.
b) Rogue websites earn their revenues through online payments made based on a subscription or advertisement revenue models. Such payments have to be routed through Payment Gateways, which shall not permit flow of payments to or from such rogue websites.
c) Search Engines shall take necessary steps to remove websites identified in the IWL, in their search results.
d) Advertisers or advertising agencies shall not host any advertisements on the websites identified in the IWL.