CCPA clamps down on seven e-commerce firms

The Central Consumer Protection Authority (CCPA) has imposed penalties totalling Rs 20 lakh on seven e-commerce platforms, including Zepto and Physics Wallah, for indulging in ‘dark patterns’ practices to manipulate choices for consumers.

The enforcement actions are in accordance with the watchdog’s guidelines issued in November, 2023 to curb the use of ‘dark patterns’ or deceptive online user interface design that tend to mislead consumers’ buying choices.

“Subsequent to the Guidelines for the Prevention Dark Pattern 2023, CCPA has taken action against e-commerce platforms engaging in dark patterns and imposed a penalty to the tune of Rs 20 lakh,” Minister of State for Food and Consumer Affairs B L Verma said in a written reply to Rajya Sabha on August 4.

Zepto, Physics Wallah, Anuj Jindal, FirstCry, PharmaEasy, McAfee and SpiceJet have been penalised while notices were served to two companies — InterGlobe Aviation and BookMyShow. They have rectified their mistakes.

A maximum penalty of Rs 7 lakh was imposed on Zepto Marketplace for using two types of dark patterns: “drip pricing and basket sneaking”.

The company’s platform showed lower price initially to lure consumer and added handling charge and Zepto Pass membership fee on a checkout page. The company has paid the penalty and discontinued the dark pattern.

The CCPA took suo motu cognisance of dark pattern practices by Physics Wallah Ltd (PW) and imposed a penalty of Rs 5 lakh.

Physics Wallah deployed ‘basket sneaking’, through which a donation of Rs 10 to PW Foundation was automatically pre-selected during checkout without explicit consumer consent.

Moreover, the authority observed that courses advertised as ‘free’ required mandatory disclosure of personal information before access was granted.

“CCPA directed to ensure that no dark patterns are deployed on any of its digital interfaces and imposed a penalty of Rs 5 lakh. Physics Wallah deposited the penalty and discontinued the dark pattern,” Verma said.

The CCPA’s guidelines address and regulate 13 specific dark patterns identified in the e-commerce sector. It aims to prevent deceptive practices that mislead consumers. he said.

The 13 prominent dark patterns in e-commerce are – False Urgency; Basket Sneaking; Confirm Shaming; Forced action; Subscription trap; Interface interference; Bait and Switch, Drip Pricing, Disguised advertisement, Nagging, Trick question, Saas Billing, and Rogue Malwares.