Ecommerce companies may find themselves in trouble yet again in India. India's Enforcement Directorate (ED) is currently investigating six ecommerce companies for allegedly violating India's foreign direct investment regulations — and 15 more companies will soon come under its scanner . "Investigation is actually underway [for the six companies]," said Prabhsahay Kaur, one of the lawyers for the government on Thursday responding to a petition filed by the All India Footwear Manufacturers and Retailers Association (AIFMRA). Kaur revealed about the ED's investigation in a hearing in the Delhi High Court. Kaur declined to share the names of the six companies that are currently under ED's investigation with MediaNama after the hearing. AIFMRA had filed a petition against 21 eCommerce companies in August alleging that all of them are violating India's foreign direct investment policies. India does not allow foreign direct investments in business to consumer eCommerce and 100% is allowed in business-to-business segment at present. Online retailers — many of which are flushed with funds from overseas — have switched to a marketplace model, acting as a platform for buyers and sellers in an effort to workaround the regulations on FDI. The lawyers for AIFMRA argue that online retailers process payments, deliver the items, take returns, and make refunds — behaving just like a traditional retailer — despite being a marketplace enabling transactions. Previously Justice Rajiv Sahai Endlaw, who is overseeing the case, found that there is a "prima facie violation" of the FDI norms. On Thursday, he said: "investigate all the other entities...and publish the information in…
