Rules 1 and 2 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Rules 1 and 2 are the gateway to the whole set of E-Commerce Rules. Rule 1 says when the rules began, and rule 2 says what they apply to: digital goods and services, marketplace and inventory models, single brand retailers, every kind of unfair trade practice online, and foreign entities that systematically sell to consumers in India.
This article takes the rules as amended up to the Consumer Protection (E-Commerce) (Amendment) Rules, 2026 (G.S.R. 789(E) of 9 September 2026, in force from 1 January 2027). Rules 1 and 2 themselves are not changed by that amendment. Later amendments should be checked on the website of the Department of Consumer Affairs.
The Consumer Protection (E-Commerce) Rules, 2020 were notified as G.S.R. 462(E) on 23 July 2020 and came into force on the date of publication in the Official Gazette. Rule 2 applies them to all goods and services bought or sold over a digital or electronic network, all models of e-commerce and all forms of unfair trade practice, and also to an e-commerce entity not established in India that systematically offers goods or services to consumers in India. A natural person acting in a personal capacity, outside any professional or commercial activity done on a regular or systematic basis, is outside the rules.
Platforms unsure of their position can ask for a compliance advisory review before the 2027 changes begin.
Rule 1: title, notification and commencement
Rule 1(1) gives the short title: the Consumer Protection (E-Commerce) Rules, 2020. Rule 1(2) says the rules "shall come into force on the date of their publication in the Official Gazette". The notification is dated 23 July 2020 at New Delhi, issued by the Ministry of Consumer Affairs, Food and Public Distribution (Department of Consumer Affairs).
The rules are made by the Central Government under clause (zg) of section 101 of the Consumer Protection Act, 2019. For the Act's rule-making power read section 101 of the Act, and for unfair trade practices in e-commerce and direct selling read section 94. The Act's own definition of "e-commerce" is in section 2. Rule 8 of these rules then brings any violation under the Act itself (see rules 7 and 8).
Rule 2(1): what the rules apply to
Rule 2(1) opens with the words "Save as otherwise expressly provided by the Central Government by notification". If the Government expressly provides otherwise, that provision prevails. Subject to that, the rules apply to four things.
- Rule 2(1)(a) - all goods and services bought or sold over a digital or electronic network, including digital products. A downloadable course, an e-book or a software subscription counts as much as a pair of shoes.
- Rule 2(1)(b) - all models of e-commerce, including the marketplace model and the inventory model. The definitions in rule 3 explain the two models.
- Rule 2(1)(c) - all e-commerce retail, including multi-channel single brand retailers and single brand retailers in single or multiple formats.
- Rule 2(1)(d) - all forms of unfair trade practices across all models of e-commerce.
The proviso: personal activity
The proviso removes "any activity of a natural person carried out in a personal capacity not being part of any professional or commercial activity undertaken on a regular or systematic basis". Both parts must hold: the person acts in a personal capacity, and the activity is not part of a professional or commercial activity done regularly or systematically. A person who occasionally lists a second-hand phone from home is the sort of case the proviso is aimed at. A person who lists goods every week for profit is not, even if there is no shop. The rule does not set a number of sales; the test is in the words.
Rule 2(2): entities outside India
Rule 2(2) begins "Notwithstanding anything contained in sub-rule (1)" and applies the rules to an e-commerce entity "which is not established in India, but systematically offers goods or services to consumers in India". Two elements matter: the entity is not established in India, and the offer to Indian consumers is systematic. The rule does not list what makes an offer systematic, so a one-off sale to a buyer in India sits differently from a website that is regularly directed at Indian buyers.
An invented example: Harbour Crafts Ltd, a company with no office in India, runs a website that quotes prices in rupees and ships to Indian cities every month. Rule 2(2) brings it within the rules, and it must show the information that rule 4 requires. For the companies that must appoint a nodal officer or an alternate senior designated functionary resident in India, see rule 4(1)-(3).
Covered and not covered at a glance
| Situation | Covered by the rules? | Rule |
|---|---|---|
| Marketplace app that connects buyers and sellers | Yes | 2(1)(b) |
| Online store that sells its own stock | Yes | 2(1)(b) |
| Single brand retailer, in one or several formats | Yes | 2(1)(c) |
| Sale of a digital product over a network | Yes | 2(1)(a) |
| Unfair trade practice on any e-commerce model | Yes | 2(1)(d) |
| Entity not established in India, systematically selling to Indian consumers | Yes | 2(2) |
| Natural person acting personally, with no regular or systematic commercial activity | No | Proviso to 2(1) |
Two layers of text today
The rules are read in two layers. The text in force today is the 2020 rules as altered by G.S.R. 328(E) of 17 May 2021, which substituted rule 4(1), and by the corrigendum G.S.R. 488(E) of 4 August 2020, under which clause letters printed in Devanagari in rule 4(2) and rule 5(3) read as (a) to (f). The 2026 amendment, G.S.R. 789(E) of 9 September 2026, comes into force only from 1 January 2027. Our rule-by-rule account of the 2026 amendment lists every change. Rules 1 and 2 are untouched, so the scope described here is the same before and after that date.
Who should read the rest of the rules
If your business is a marketplace, rule 5 and rule 5(3) matter most. If you sell on a marketplace, read rule 6. If you hold your own stock and sell directly, read rule 7. The existing overview of the E-Commerce Consumer Protection Rules gives the general picture.
Need help with e-commerce rules compliance?
If you are not sure whether your platform, seller account or foreign website falls within rule 2, a short review of the facts usually settles it. Our compliance advisory team can map your business model to the rules and list what has to be displayed and recorded.
Key takeaways
- The rules took effect on the date of publication of G.S.R. 462(E), 23 July 2020.
- They cover goods, services and digital products, marketplace and inventory models, and single brand retail.
- Rule 2(2) reaches entities not established in India that systematically offer goods or services to Indian consumers.
- A natural person acting personally, outside regular or systematic commercial activity, is excluded.
- The 2026 amendment does not change rules 1 and 2.
Read next
- Rule 3: definitions of marketplace, inventory and ranking
- Consumer Protection (E-Commerce) (Amendment) Rules, 2026: every change from 1 January 2027
- E-Commerce Consumer Protection Rules 2020: overview
- Section 94 of the Consumer Protection Act, 2019: e-commerce and direct selling
Disclaimer: Based on the rules, regulations and guidelines named above as published in the Gazette of India or on the CCPA website, with the amending notifications the article names (consulted on 3 October 2026). Later amendments, the Consumer Protection Act, 2019 provisions referred to, State rules and CCPA advisories should be checked. This article is general information, not legal advice; check the official text before acting.