Rule 5
Rule 5: liabilities of marketplace e-commerce entities
Rule 5 is directed at marketplace operators that connect buyers and sellers. It addresses seller undertakings, consumer-facing disclosures, complaint tracking, ranking information and certain repeat-seller records.
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This article is for general information. Check the notified Rules and later amendments. For advice specific to your business, contact Bizeneed.
Introduction
A marketplace is the platform model in rule 3(1)(g). Rule 5's duties sit alongside rule 4's general e-commerce-entity duties and rule 6's duties placed directly on the sellers using the marketplace.
Rule 5(1) links an entity seeking the Information Technology Act section 79(1) liability exemption to the conditions under section 79(2) and (3), including intermediary-rule compliance. This guide does not decide whether a particular platform qualifies for that exemption.
Key takeaways
Seller claims need an undertaking
Rule 5(2) requires the marketplace to obtain the seller's undertaking on the accuracy of descriptions, images and other product or service content.
Show useful pre-purchase facts
Rule 5(3) covers seller identity, returns and warranties, payments, complaint tracking, seller-supplied information and a plain-language account of ranking parameters.
Explain differentiated treatment
Marketplace terms with sellers must describe any differentiated treatment given or potentially given among same-category goods, services or sellers.
Obtain seller listing undertakings
Make the seller attest that descriptions, images and other listing content match the goods or services. Keep the undertaking with the marketplace contract and update it as listings change. This is a rule 5(2) platform obligation.
Display seller and transaction information
Make seller business details and feedback available at the appropriate pre-purchase point. Show return, refund, exchange, warranty, delivery, payment and grievance information. Rule 5(3) also requires a trackable ticket number for each lodged complaint and display of the information sellers provide under rule 6(5).
Explain ranking and differentiated treatment
Publish a plain and intelligible explanation of the most significant ranking parameters and their relative importance under rule 5(3)(f). In marketplace seller terms, describe differentiated treatment between same-category goods, services or sellers under rule 5(4).
Keep records for repeat removed listings
Rule 5(5) calls for reasonable efforts to maintain information identifying sellers who repeatedly offered items previously removed or disabled under the Copyright, Trade Marks or Information Technology Acts. Its proviso does not require automatic termination of seller access, though the marketplace may do so voluntarily.
Practical checklist
Do
- Collect and retain seller accuracy undertakings.
- Test every complaint ticket's status tracking.
- Audit seller and return disclosures on product pages.
- Publish and update the main ranking-parameter explanation.
- Document reasonable recordkeeping for repeat removed listings.
Avoid
- Do not claim section 79 immunity merely because the platform is a marketplace.
- Do not hide differentiated treatment from seller terms.
- Do not state that rule 5(5) mandates automatic seller termination.
FAQs
Must a marketplace disclose its ranking method?
Rule 5(3)(f) requires an easily and publicly available, plain-language description of the main ranking parameters and their relative importance.
Does a repeat removed listing require a seller ban?
Rule 5(5) requires reasonable efforts to keep relevant identifying records, but its proviso says the rule does not itself require terminating platform access.
Official sources
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