Kathmandu, Nepal – The E-commerce Act, set to take effect from Baisakh 2, 2082, has sparked widespread debate, particularly among small and medium-sized online entrepreneurs. Formulated by the Ministry of Industry, Commerce, and Supplies, the bill aims to regulate electronic transactions, ensuring fair trade practices, transparency, and consumer protection. However, concerns have been raised that the bill may impose excessive compliance burdens on small sellers, potentially driving them out of business.

Why Was the E-commerce Bill Introduced?

The rapid expansion of Nepal’s e-commerce sector has created the need for a regulatory framework to establish transparency, accountability, and consumer rights protection. The bill mandates that all e-commerce businesses must be registered on a government portal, obtain official approval, and develop an independent e-commerce platform detailing product specifications, pricing, delivery timelines, and grievance redressal mechanisms.

Positive Aspects of the Nepal E-commerce Act 2081

Supporters of the bill argue that it will enhance the credibility of the e-commerce sector, ensuring greater trust among consumers and businesses. Some key benefits include:

1. Mandatory registration, ensuring accountability and protecting stakeholder interests.

2. Standardized pricing, prohibiting discrimination and unfair discounts among sellers.

3. Clearer terms for return policies and dispute resolution mechanisms.

4. Provisions for international sellers operating in Nepal.

5. Strict penalties, including fines and imprisonment, for fraudulent e-commerce activities.

6. Mandatory agreements for promoters of third-party products and services, enhancing liability and transparency.

Challenges for Small Entrepreneurs

Despite its positive aspects, small sellers fear that the high cost of compliance may make it difficult for them to compete in the market. The key concerns include:

1. Financial Burden – Setting up an independent e-commerce platform with mandatory product details and a grievance section can be costly for small businesses.

2. Consumer-Centric Approach – The bill primarily focuses on consumer rights, placing heavy liability on sellers and intermediaries while not addressing consumer accountability in cases of false complaints or last-minute cancellations.

3. Ambiguous Legal Framework – The bill lacks clarity on aspects such as return policies and delivery disputes, leaving room for legal uncertainties.

4. Conflict with Existing Laws – The bill overlaps with the Consumer Protection Act 2075, raising concerns about legal inconsistencies.

5. Unregulated Social Media Marketplaces – Many small businesses operate through Facebook Marketplace and Instagram stores, but the bill does not address their legal standing or how they will be regulated.

What Needs to Change?

While the bill is a step forward in making Nepal’s e-commerce ecosystem more organized, it requires certain refinements to prevent harm to small businesses:

1. Tier-based regulations based on business turnover to ease compliance for small sellers.

2. Clearer liability distribution between sellers and consumers.

3. Defining jurisdiction and clarifying vague legal provisions to avoid conflicts with existing consumer protection laws.

4. Recognizing social media-based e-commerce platforms and ensuring their legitimacy under the law.

The E-commerce Act has the potential to strengthen Nepal’s digital marketplace, but without modifications, it risks disproportionately impacting small sellers. To strike a balance between regulation and growth, policymakers must refine the bill, ensuring that it fosters fair trade while supporting small entrepreneurs in the evolving digital economy.