Fake reviews on e-commerce websites on the government radar

Even before the advent of the Covid-19 pandemic, a majority of Indian households had started to prefer buying goods online rather than going to markets. One of the reasons for opting for e-commerce platforms over conventional channels is the multitude of reviews available that allow the consumer to make an informed decision. According to a recent report by CHEQ (“THE ECONOMIC COST OF BAD ACTORS ON THE INTERNET, FAKE ONLINE REVIEWS 2021”), online reviews influenced nearly $3.8 trillion in global e-commerce spent in 2021. [1]

Lately, however, the number of fake reviews on these websites has steadily increased, defeating the very purpose of these reviews. The CHEQ report defines a fake online review as “any positive, neutral or negative review that is not the honest and unbiased opinion of a real consumer and does not reflect an authentic experience of a product, service or business. There are many sites on which reviews appear: ranging from online brands that integrate online reviews into their core offering (like Amazon), sites that integrate third-party review platforms like Expedia, and platforms whose primary purpose is is to provide reviews and comments. (like TripAdvisor)”. [1] According to a 2019 Daily Mail investigation, sellers on Amazon bought fake reviews for around INR 1,200 ($15).

Aware of this issue and with a view to preparing a roadmap to address it, the Indian Department of Consumer Affairs (DoCA) in association with the Advertising Standards Council of India (ASCI) held a virtual meeting on 27th May 2022, calling on the various stakeholders such as e-commerce giants like Flipkart, Amazon, Tata Sons, Reliance Retail and others, besides also inviting consumer forums, law academies, lawyers, Federation of Indian Chambers of Commerce and Industry (FICCI), Confederation of Indian Industries (CII), Consumer Rights Advocates, etc.

In a letter to stakeholders ahead of the virtual meeting, Mr. Rohit Kumar Singh, Secretary, DoCA, shared a press release from the European Commission dated January 20, 2022, highlighting the results of a review at the European scale of online consumer reviews on 223 major websites. The results of the review highlighted that at least 55% of websites violated the EU’s 2005 Unfair Commercial Practices Directive, which required consumers to be presented with truthful information to make an informed choice. Furthermore, the stated press release mentioned that in 144 of the 223 websites checked, authorities were unable to confirm that merchants were doing enough to ensure that the reviews were genuine i.e. if they were posted by consumers who had actually used the product or service being reviewed.

The aforementioned letter also stated:It is pertinent to mention that with the increasing use of internet and smartphones, consumers are increasingly shopping online to purchase goods and services. Since e-commerce involves a virtual shopping experience without any opportunity to physically see or examine the product, consumers rely heavily on reviews posted on e-commerce platforms to know the opinion and experiences. users who have already purchased the good or service. As a result, due to false and misleading reviews, the right to be informed, which is a consumer right under the Consumer Protection Act 2019, is violated. Since the issue has a daily impact on people who buy online and has a significant impact on their rights as a consumer, it is important that it be examined in more detail and attention.

Similar to the 2005 EU directive, the Indian Consumer Protection Act 2019 protects the consumer’s right to be informed. Specifically, Section 2(9) of the Act states:Consumer rights” include,— (ii) the right to be informed of the quality, quantity, potency, purity, standard and price of goods, products or services, as the case may be, so as to protect the consumer against commercial practices.

During the meeting, all stakeholders agreed that the issue in question deserved meticulous observation and that an appropriate framework for it could be established for the benefit of the consumer. Among the issues discussed were paid reviews, unverifiable reviews, and the lack of disclosure in the case of incentivized reviews, which makes it difficult for consumers to recognize genuine reviews.

According to an official statement made following the virtual meeting, the Department of Consumer Affairs (DoCA) will develop frameworks to control fake reviews on e-commerce websites after studying the current mechanism followed by e-commerce entities in India. and the best practices available worldwide.