The Central Consumer Protection Authority (CCPA) has cracked down on online pharmacy giant PharmEasy, imposing a significant penalty for employing deceptive digital practices. The regulator has levied a fine of Rs 2 lakh on the company for automatically renewing customer subscriptions without obtaining their explicit consent.
What Was PharmEasy's Unfair Practice?
The CCPA identified this automatic renewal mechanism as a 'basket sneaking' dark pattern. This unfair trade practice involves pre-selecting or automatically adding a paid service to a user's cart during the checkout process. In this case, a three-month membership subscription costing Rs 99 was being auto-added, misleading users about the final payable amount.
The authority strongly condemned this design, stating it "undermines consumer autonomy and induces consumers to pay for a service they did not knowingly opt for." The case was initiated by the CCPA on its own motion (suo motu) after it noticed the platform was engaging in this practice.
Regulatory Action and Company's Response
A show-cause notice was issued in June to Axelia Solutions, the operator of PharmEasy. The company admitted that an "auto-addition" feature was active for some users but claimed it was only for existing subscribers and was in the process of being withdrawn.
However, the CCPA observed that the company discontinued the practice only after the authority took up the case. In its order, the regulator noted, "The corrective steps were reactive and undertaken only after regulatory intervention, which reinforces the seriousness of the initial breach."
The Outcome and Directives
The investigation revealed that nearly 24,000 subscriptions were processed through this unauthorized auto-renewal mechanism. Consequently, the CCPA has issued a two-pronged directive to PharmEasy.
The company has been ordered to discontinue the feature entirely and to issue refunds to all consumers who were charged without their explicit consent. This move aims to provide relief to the thousands of users who were unfairly charged for a service they did not actively choose.
This case serves as a stern warning to e-commerce platforms against using manipulative dark patterns to generate revenue, emphasizing the importance of transparent and consent-based user transactions.
