The Consumer Affairs Authority (CAA) today raided Kapruka, an online retail store, for violating regulations on the maximum retail rices and unethical business practices.

Kapruka, an online shopping and delivery service in Sri Lanka, has come under severe criticism from a number of clients on social media for overcharging customers and for repeatedly failing to meet delivery deadlines.

Kapruka made its services available to clients after the government declared an islandwide curfew in the wake of COVID19 outbreak in Sri Lanka. The company said the service would enable clients to place orders for essential items during the time of curfew and the deliveries would be made within 24 hours.

Many who relied on Kapruka for essential items during the curfew period are now facing severe difficulties.

Kapruka, an online shopping and delivery service in Sri Lanka, has come under severe criticism from a number of clients on social media for overcharging customers and for repeatedly failing to meet delivery deadlines.

Kapruka made its services available to clients after the government declared an islandwide curfew in the wake of COVID19 outbreak in Sri Lanka. The company said the service would enable clients to place orders for essential items during the time of curfew and the deliveries would be made within 24 hours.

Raha Jayawardena, an enraged client of Kapruka posted on Facebook, "You cannot display an estimated delivery date of 24th (24 hours) before placing the order and adjust it to 29th after placing the order because we rely on your delivery to feed the family. Not at this time!" Though we noticed some of the items sold by Kapruka were grossly over priced (For example, 1 KG of potatoes was priced LKR 534) we still made the choice to purchase with the promise of delivery by 24th of March. So, no complains here!

"Just to give an example, with one order, the total price to be paid was LKR 4343.00 for the shopping cart + another LKR 650 for the delivery totaling to LKR 4993.00 We made the payment through a local credit card with a local billing address. But when we received the Order Confirmation I received a USD 38.75 charge notification on my credit card. This is an equivalent of LKR 7246.00 at the prevailing exchange rate. To add to the injury, the order status page of Kapruka suddenly started showing a new delivery estimate of 29th March," he also said.

Another Kapruka client also shared her experience on Twitter; "As for my Kapruka orders, I don't know whether to live in hope or give up the ghost." Many other people shared similar views expressing doubts about the responsibility and professionalism of the country in the midst of a national crisis.

Kapruka CEO and Founder Dulith Herath has found himself the target of online ire after comments he made at a pre-budget forum organised by Standard Chartered Bank were published in the media.

The media has reported Herath as saying: “We in the e-commerce industry have seen this increasing of single packages that are coming into the country through Alibaba, eBay and other websites.”

“Initially we thought this was small but it’s almost like products raining into the country and it’s going undetected because they arrive directly onto the doorstep.”

“This means local traders in Pettah have to compete with eBay. So we have to control this, in my view, at the post office level, for it to be fair trade and improve commerce in competitive way.”

Despite his comments championing the cause of ‘Pettah traders’ he has been censured online for ‘anti-free market’ comments aimed at promoting what users online have termed as ‘monolithic’ business empires.

Herath has come under criticism for wanting to restrict trade from sites such as Amazon, Alibaba and eBay to to create demand for his site Kapruka.

Commenting on Facebook, a user said, “What a disgrace. This man wants the government to implement policies that would infringe on the consumers right to choose, so that he and “other merchants in Pettah” can act as middlemen and take their cut from selling the same Chinese product that consumers could have bought directly from Chinese vendors for a lower price.”

Another said, “All the countries have a limit on the value of the products that can be imported without duty. In Australia, personally you can import anything up to AUD1000 without paying GST of 10%. Sri Lanka has the same rule which I believe is up to $30 but don’t quote me on that. Don’t try to lobby the government for your personal gain.”

Attempting to defend himself Dulith Herath has commented on the post against him saying, “They misinterpreted what I said. What I said is post office must charge correct duty for small packages. We can’t have a duty-free channel into this country when regular retail is having to pay import duty.”

He was however called out by another commenter of Facebook, who said, “Customs charge duty after inspecting packages coming into the country. So your statement is not valid. I believe you are promoting this idea for personal gain.”

Meanwhile, former ICTA CEO and MD Muhunthan Canagey waded into contention, speaking on behalf of Kapruka founder Dulith Herath.

In his comments Canagey said: “Before I start explaining my views, I want people on this thread to know that I am in support and a firm believer of non-monopolistic principles irrespective of borders, but not an unfair system and policy differentiating local and foreign companies.”

“Lets be fair with this guy and Kapruka; when Kapruka has to pay the correct declared taxes for goods brought down by they and distributed, while the goods that come through local post are delivered without paying the right taxes, in most cases even without taxes, in many cases goods are undervalued because the invoices don’t come with them.”

“These guys Kapruka go by investing on delivery, call centre, tracking systems, advance the cash required for paying the taxes on your behalf and taking responsibility for the order. They have also enabled people to visit a store and order giving the convenience and enabling people who not so familiar with online booking.”

“It is the state which must implement a propose process for online declaration and online tax paying method for such goods that come through the postal service and the delivery must happen after such import duties are paid correctly to the customs.”

“It is unfair when such processes are not adopted. There should not be different treatment for state institutions and private companies. People must realize that hardworking taxpayers are paying for these inefficient state organizations process and pilferage by those who don’t pay their due taxes.”

“ It is normal for such discriminated private sector institutions to state their grievances at such open forums and be treated fairly. So from a consumer rights either the government must correct the process of take out the duties and taxes if they cannot manage parcels less than a particular value.”