FDI e-commerce policies should protect the interests of small merchants

New Delhi: Foreign companies, which are only allowed to set up e-commerce marketplaces, should have no direct or indirect control over inventory levels, the Chamber of Commerce PHDCCI said on Monday.

To this end, the Chamber believes that the definition of group companies should be expanded to include companies that operate the marketplace platform themselves, their group companies, their affiliated companies, their affiliated companies, their related parties and any other person controlled directly or indirectly, by above or in which the person has any direct or indirect capital or beneficial interest in any of the above companies.

In a series of proposals for inclusion in the FDI e-Commerce Policy, the Chamber said that FDI e-commerce marketplaces should not be allowed to directly or indirectly control inventory as this constitutes a prohibited multi-brand retail trade Foreigners equal companies.

Therefore, the definition of marketplace-based e-commerce and inventory-based e-commerce model should be defined as an information technology platform of an e-commerce entity on a digital and electronic network to act as an intermediary between buyers and sellers.

The proposals, the chamber says, aim to protect the interests of 8 million small traders and the livelihoods of 30 million people who depend on them. The Chamber believes that while the government has issued a policy to protect the interests of smaller traders, there are still a number of issues that need to be addressed.

PHDCCI said that an inventory-based e-commerce model should mean an e-commerce activity where the inventory of any of the goods or services sold on the e-commerce platform is directly or indirectly owned or controlled by the e-commerce -Unit is and is sold direct to consumers.

If goods or services sold by the group companies are resold on the e-commerce platform, this activity is also treated as an inventory-based e-commerce model.

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