Government Imposes Strict Regulations on E-commerce Operations

Kathmandu. The government is set to strictly regulate electronic commerce (e-commerce). The Ministry of Industry, Commerce and Supplies has issued a directive concerning the rapidly growing electronic trade to regulate it.

The new directive introduced by the Ministry of Industry includes provisions for the closure of e-commerce platforms operating without registration. According to the directive, businesses trading goods or services through electronic means must now mandatorily register on the government portal.

The provision states that if information is received that a firm is conducting electronic trade without registration, a government inspection officer will order that firm to register within seven days. If registration is not completed within that deadline, the department will initiate action to close down such a platform, as stipulated in the directive.

The directive also covers the provision for cancellation of registration. Registration will be cancelled if the concerned firm is dissolved, if it is confirmed that deliberately false or misleading details were provided to the department during registration or update, or if the concerned firm applies for removal from the registration list. Firms involved in electronic trade (e-commerce) transactions must fulfill their tax obligations with the relevant body according to prevailing laws.

The department will provide registration, update, and cancellation services for firms free of charge. All electronic trade (e-commerce) businesses must use only digital payment gateways approved by the Nepal Rastra Bank when conducting commercial transactions. The directive states: 'In cases where payment for goods or services is made in cash, an electronic invoice must be mandatorily issued for the transaction. If a refund needs to be given to the buyer, the business must process the refund within seven days.'

The directive also mandates all electronic trade (e-commerce) businesses to maintain user privacy and data security. According to the directive, e-commerce platforms must securely store encrypted sensitive personal details used for authentication, such as user passwords, phone/mobile numbers, addresses, and dates of birth.

For other general details, appropriate technical and managerial security measures must be adopted to prevent unauthorized access, misuse, or leakage. According to the directive, if unauthorized access or leakage of user information occurs, or if any malfunction arises on the platform, business operations must cease immediately and can only resume after recovery is complete. Public disclosure regarding this must be made.

After the firm transfers the goods or services, the business is not permitted to charge any amount related to payment other than the price of the goods or services and the transportation or transfer cost specified prior to the sale. – News Agency Nepal