Government to Tighten FDI Rules for E-Commerce

Government to Tighten FDI Rules for E-Commerce

Government is likely to tighten the Foreign Direct Investment (FDI) guidelines for e-commerce to examine corporations set up by the online marketplaces from trading on their own platform.

The Confederation of All India Merchants (CAIT) has repeatedly complained to the federal government that e-commerce operators are violating FDI rules for e-commerce. “There’s a scope for enhancing the present framework,” mentioned a senior authorities official.

The Department for Promotion of Industry and Internal Trade (DPIIT) may issue a clarification through a Press Note, expressly prohibiting e-commerce platforms from holding stake in a seller, directly or indirectly.

As per an official “this has come to our knowledge that there are instances that some e-commerce operators are not following the rules and hold indirect interest in associates”.

Further, second official added “When B2C ecommerce is not allowed, these operators have evaded the rules by setting up associates. We want to ensure a level playing field for all.”

However, the division will maintain consultations with all stakeholders earlier than it points the clarification.

Source: – India planning tighter FDI rules for e-commerce sector

Knowledge Source:

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