meesho: Meesho served notice on non-compliance with metrology rules on country of origin, other details

Bangalore: According to a notice to the company from the Department of Legal Metrology, ecommerce firm Meesho was not in compliance with regulations that require ecommerce entities to ensure the display of mandatory declarations on products including the country of origin on its platform.

The department sent a “final reminder” to the Bengaluru-based company on January 21 this year, seeking a response to a notice for alleged non-compliance, which was first sent to Meesho’s parent, Fashionier Technologies, on December 31. Was. 2021. In a January note, the department said that if Meesho did not respond to follow-up questions within a week, it would be “constrained” to go to court. ET has reviewed the notice, which also noted past incidents of alleged non-compliance of metrology rules by SoftBank and the Meta-backed company.

ET has learned that Meesho had paid a fine of Rs 75,000 for the alleged non-compliance at least once last year.

Meesho is a law abiding company and is committed to comply with the laws of the country. It said, “We are aware of the need to display country of origin and our products across categories display the same,” but did not respond to ET’s specific queries on notices sent by the Department of Legal Metrology.

The government had said in 2020 that retailers will have to show country of origin for products and other information such as MRP and vendor details on their platform. The fines, however, are relatively small for a company like Meesho, which has a monthly cash balance of around $40 million.

The rules over the country of origin became the subject of controversy during India-China border tensions in 2020. The department had fined Amazon India in 2020, one of the first instances of non-compliance with the rule.

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The notices sent to Meesho contained screenshots of some product listings on the platform, which showed that they had insufficient details.

To be sure, large etailers such as Amazon India and Walmart-owned Flipkart were also faced with the task of updating their existing listings as well as ensuring new products are listed with sufficient information, especially original ones. on the country. The government had held several meetings with top retailers to apprise them of its stand, including that the rule may promote domestic products rather than those made entirely overseas.

According to a recent survey by LocalCircles, a community social media platform, one out of every two consumers who shop online are generally unable to get information about MRP and country of origin. Plus, four out of five ecommerce shoppers claimed they didn’t find the best dates for a product. LocalCircle said it has received screenshots from consumers on these issues which are also being taken up with the government.

Meesho started as a social commerce startup with a reseller model but has built a major pivot for direct-to-consumer ecommerce and is now trying to compete with the likes of Amazon India and Flipkart. Its monthly spend has been rising steadily since it announced plans to take on existing stalwarts in the sector.

Meesho has been in talks with a number of investors for a fresh round of funding over the past few months, but they are yet to reach an agreement. It last raised $570 million led by US asset manager Fidelity and Eduardo Saverin’s B Capital, after which its valuation more than doubled to $4.9 billion in less than six months.

ET reported on March 22 that the company has started working on rebranding itself to reach out to a larger set of users, especially men. The company has been focusing on female users till now.

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