Traders’ body Confederation of All India Traders (CAIT) said that some multinational e-commerce entities with huge arsenal of funds operating in India have attempted to flout FDI norms. Releasing a white paper document, the industry body said: “The FDI policy has been put in place in a variety of interpretations and e-commerce entities structure their relationship with sellers as a marketplace in such a way that they are able to access sellers on their platforms.” Or even avoid the inventory and scrutiny of enforcement agencies.”
“Under the guise of such control or ownership over vendors, the issue ranges from mere violation of FDI policy to anti-competitive practices.”
“Mitigation measures and strict action are paramount to implement the law in letter and spirit. Otherwise, the FDI policy on e-commerce will fail in its objective of serving the interests of domestic manufacturers, traders, vendors, MSMEs, startups and providing an equal opportunity in the retail sector.”
Definition of e-commerce, clearly capturing the role of a neutral e-commerce marketplace and MRBT stores operated in electronic form is the need of the hour, it suggested.
“To avoid such conflicts of interest and prevent market distortions, it is essential that the Marketplace Platform should function in a neutral manner and not have any relationship with sellers (whether by shareholding, controlling or otherwise, direct or indirectly) or with registered sellers on the platform as it leads the marketplace to act as seller, which is essentially an inventory-based model of e-commerce.”
Further, it said that neither the marketplace entity should act as an inventory-based e-commerce entity, nor should the inventory-based e-commerce entities act as a marketplace entity.
In addition, an e-commerce regulator should be set up and it should be commissioned to look into unfair trade practices on the platform of end consumers as well as intermediate consumers such as vendors, it said.
It said, “The right to free and fair trade must be safeguarded for the many small sellers who look to e-commerce platforms for their livelihood and consumers who equally rely on such platforms for their needs.” are dependent.” Registration should be terminated for conducting e-commerce activities.
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