African watchdog forces Jumia to review its terms in push to protect consumers
Africa’s largest e-commerce site Jumia has amended its terms and conditions after the regional watchdog, the COMESA (Common Markets for Eastern and Southern Africa) Competition Commission, compelled the marketplace to review clauses and disclaimers it found misleading or false.
The commission, which precludes restrictive business practices across the common market (21 countries) in Africa, forced Jumia to make the changes following investigations into the marketplace’s conduct starting September 2021.
The Commission said Jumia’s presence in more than one COMESA member state, its millions of sellers and the extent of commerce it facilitates imply that it “could have an appreciable effect on trade in the common market.”
The commission’s findings
The watchdog established that Jumia had exempted itself from being a party to the sale agreement to skirt responsibility for products sold by third-party sellers on its platform. Jumia had borrowed the script from major e-commerce sites like Amazon, which have in the past tried to avoid being liable for products sold on their platforms by branding themselves as enablers.
In the wake of the review, Jumia will be held liable for products and transactions carried out on its platform.
“The Commission’s observation was that Jumia was dissociating itself from the transaction when in an actual transaction the consumer deals only with Jumia, in that it is the one that receives the orders, payments, and delivers on behalf of the seller,” said the COMESA Competition Commission in a statement.
Jumia is required to clearly indicate where it is the seller, and amend the terms to show it is liable for the products sold. And, where a third-party is involved, the e-commerce site will provide access to a sale agreement between the seller, for the buyer to review and accept the terms before buying the goods.
This is a big shift given that, in a 2019 U.S. Securities and Exchange Commission (SEC) filing of its initial public offering (IPO) on the New York Stock Exchange, Jumia revealed it could not guarantee the quality and safety of the goods sold on its platform, or prevent the “sale of harmful or defective goods, which could cause death, disease or injury to our consumers or damage their property.”
Jumia will henceforth also ensure the accuracy of information on sellers and products posted on its platform.
“Any person affected by the inaccuracy of the information published on the platform can return the product to the extent that it is affected by the inaccurate information that was bought through the platform,” said the Commission.
The e-commerce site was also found to lack details of the entity that owned it, and legal representatives, which made it hard for consumers or authorities initiating a suit against Jumia from knowing who to serve.
The Commission now requires Jumia to include, in its terms and conditions, a clause comprising “the entity to be served for legal purposes with its full details including the name, location, post office address, telephone and email contact.”
It was further recommended that the e-commerce company puts in place conflict resolution channels, amends the terms to indicate that in case the marketplace is discontinued “it would be done without prejudice of the consumer’s rights in respect of any unfulfilled orders or other existing liabilities of Jumia.”
The e-commerce site, which operates in 11 markets in Africa, including Egypt, Kenya, Nigeria and South Africa, some of the continent’s biggest economies, agreed to make the changes.
“We have fully adhered to the recommendations provided by the COMESA Competition Commission and will continue to work closely with them to ensure that our policies are even more protective for our customers,” said Jumia.
Updated to include Jumia’s statement.
