INTRODUCTION:
While anyone who has been a consumer of goods/services on online e-commerce platforms would have encountered dark patterns, the probability that one would have realized such an encounter is nearly non-existent, hence the name of the phenomenon. This is exemplified when you are trying to order a food item on a food delivery application, and the actual price, inclusive of delivery fee, handling charges, taxes etc. is only shown to you at the last leg of the transaction, and not at the initial stage when you are selecting the food item. This hampers a consumer's ability to make a free and informed choice, at the time of selecting the items, and dilutes one's understanding of how much a particular item would end up costing you. The fact that such patterns not only exist, but are rampant and not easily discernable, is the very essence of the concern.
Dark patterns are basically user interface that has been crafted to manipulate users into making choices that are detrimental to their interest - such as buying a more expensive product, paying more than what was initially disclosed, sharing data or making choices based on false or paid-for reviews, and so on. User experience designer Harry Brignull coined the term "Dark Patterns" in 2010 to describe such practices.
The Indian legal landscape does not directly refer to dark patterns and hence the recognition of this concept, and the corresponding measures, have long been absent in India. However, Advertising Standards Council of India ("ASCI"), a self-regulatory body has, on June 15, 2023, released the Guidelines for Online Deceptive Design Patterns in Advertising ("Guidelines") aiming to regulate the use of dark patterns in digital advertising. These Guidelines will be effective from September 01, 2023.
In this article, we analyze the content of the ASCI Guidelines, the need for a robust regulation around dark patterns, and the measures, which in our opinion, could help discern and regulate these dark patterns in an efficient manner.
ASCI Guidelines
On June 15, 2023, ASCI released Guidelines aiming to regulate the use of dark patterns in digital advertising. These Guidelines will be effective from September 01, 2023.
The key aspects of the Guidelines are as follows: -
- Quoted prices in advertisements and e-commerce sites must
include non-optional taxes, duties, fees and charges that apply to
all or most buyers so as to prevent drip
pricing, which is a practice whereby elements of the
prices are not revealed upfront, and the total price is only
revealed at the very end of the buying process or post-confirmation
of purchase.
- The practice of bait and switchis
considered as misleading where an ad or an element in the ad
directly or indirectly implies one outcome based on the
consumer's action, but instead serves an alternative outcome.
For example - offering an attractive product to the customer,
eventually revealing that it is out of stock and then offering an
alternative product.
- Creating false urgencyis considered
as misleading. For example – advertisers stating or implying
that quantities of a particular product or service are (e.g.,
airline seats available at a certain price) more limited than they
actually are, amount to misleading consumers.
- Disguised advertisementse., showing advertisements in a format similar to editorial or organic content such as influencer posts, paid reviews etc. – is considered as misleading. Such advertisements must clearly disclose that it is an advertisement or sponsored content.
SUGGESTIONS FOR AN EFFECTIVE INDIAN LEGAL LANDSCAPE AROUND DARK PATTERNS:
While ASCI Guidelines mention certain vital types of dark patterns, some of the types of dark patterns that ASCI fails to cover under its guidelines are mentioned below:
- Misdirection: Diverting users' attention
away from essential information, often by using visual cues or
confusing layouts.
- Hidden Costs: Concealing additional fees or
charges until the final stages of a transaction.
- Friend Spam: Encouraging users to invite
friends to a platform, while using deceptive tactics to access
their contacts.
- Misleading Visuals: Using graphics or icons to
convey false information or create a false sense of urgency.
- Fake Reviews: Publishing fictitious or biased
reviews to promote a product or service.
- Social Proof Manipulation: Fabricating or
exaggerating social proof indicators, such as the number of users
or positive reviews.
- Pre-selection: Automatically opting users into
choices they didn't make, requiring them to deselect
options.
- Dark UX Patterns: Using confusing or deceptive
design elements to trick users into making unintended
choices.
- Invasive Permission Requests: Requesting
unnecessary access to personal data or device features.
- Hidden Terms and Conditions: Burying important terms and conditions deep in a website or application.
The Guidelines are certainly a welcome step, as the Indian legal landscape till now was pretty much silent on the subject of dark patterns. Considering ASCI is a self-regulatory body and is not in a position to strictly enforce its provisions thus, in addition to strengthening the Guidelines, inclusion of dark patterns in other laws/regulations is required.
The Department of Consumer Affairs has also released 'Additional Influencer Guidelines For Health and Wellness Celebrities, Influencers and Virtual Influencers' which delineates certain responsibilities on influencers to be cautious when making claims related to healthcare and medicine. This exemplifies the Government of India's inclination to eradicating dark patterns borne out of misleading information or incomplete consent.
In India, consumers are protected through the Consumer Protection Act, 2019 ("CPA"), which prohibits unfair trade practices. An exhaustive scope of unfair trade practices is prescribed under the provisions of CPA. Further, the Consumer Protection (E-Commerce) Rules, 2020 ("E-Commerce Rules") are applicable to all transactions involving goods and services conducted over digital or electronic networks. These rules cover various e-commerce models, including marketplace and inventory models. Both e-commerce entities and sellers on marketplace e-commerce entities are prohibited from engaging in any unfair trade practices under these rules, and any violation of the E-Commerce Rules will result in similar consequences as stated under the CPA.
If the Central Consumer Protection Authority ("CCPA") finds that consumer rights are violated, it can issue guidelines to prevent unfair practices and pass orders for product withdrawal, reimbursement, or discontinuation of unfair practices. It also has the power to initiate inquiries and investigations either suo moto or upon receiving complaints.
Non-compliance with the CCPA's directions can lead to imprisonment for up to six months or a fine of up to INR 20 Lakhs, or both. Additionally, causing false or misleading advertisement which is prejudicial to the interest of consumers, is also a punishable offense under the CPA, with imprisonment of up to two years and a fine of up to INR 10 Lakh. Additionally, for subsequent offenses, imprisonment of up to five years and a fine of up to INR 50 Lakh, and for every subsequent offence, imprisonment for a term which may extend to five years and fine which may extend to INR 50 Lakh, may be imposed.
Consumers can also file complaints with the district commission regarding goods or services related to unfair trade practices. The district commission, upon being satisfied with the claims, can order the discontinuation of such practices.
Further, E-commerce Rules prescribe that every e-commerce entity shall only record the consent of a consumer for the purchase of any good or service offered on its platform where such consent is expressed through an explicit and affirmative action. No such entity shall record such consent automatically, including in the form of pre-ticked checkboxes. The direct enforcement of this rule can eradicate a variety of dark patterns.
Hence, in light of the aforementioned, it could prove to be helpful to recognize these dark patterns and include appropriate provisions in the Consumer Protection Act and E-commerce Rules to protect consumers. An additional effective measure could be to include certain dark patterns into the scope of unfair trade practice.
Also within the scope of this discussion is, whether consent is required for collection of personal data. Dark patterns enable platforms to gather vast amounts of data by exploiting users' attention cycle, use or share collected data, profile users and their practices etc., without users' explicit consent. Consequently, the power of decision-making and privacy is compromised when dark patterns undermine free will and interfere with individuals' self-interest, agency and autonomy.
Users' free and informed consent has been prioritized by data protection legislation across the globe. For instance, the General Data Protection Regulation ("GDPR") defines consent as "any freely given, specific, informed and unambiguous indication of the data subject's wishes by which he or she, by a statement or by a clear affirmative action, signifies agreement to the processing of personal data relating to him or her". The Information Technology (Reasonable security practices and procedures and sensitive personal data or information) Rules, 2011 ("SPDI Rules") also requires informed consent of the user before their sensitive personal data is collected. Additionally, the newly minted Digital Personal Data Protection Act 2023 similarly puts emphasis on consent obtained from the Data Principal before processing the said data. As a result, implicit or opt-out consent that does not involve a positive action cannot be considered valid. Hence, consent must be explicit, requiring a clear, positive, and affirmative act.
As dark patterns negate the consent of the user/customer in many ways, it is imperative to recognize and regulate these dark patterns in order to efficiently obtain users' free and informed consent before processing their personal data.
CONCLUSION:
With the right framework, and adequate treatment of dark pattern in Indian regulatory & legal scenario, the Indian e-commerce space and the adjoining advertising can potentially become more transparent, resulting in an immediate benefit to the consumers, in the form of increased security, as well as for e-commerce players, by way of increased trustworthiness.
Article written by Mr. Advait Luthra, Partner, TMT practice, Luthra and Luthra Law Offices and Ms. Ananya Mishra, Senior Associate, TMT practice, Luthra and Luthra Law Offices India.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
