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India’s draft Ecommerce Policy: Online Vendors’ Association wants marketplaces regulated as “economic utilities”

The All India Online Vendors Association (AIOVA) has submitted comments to the DPIIT on the E-Commerce Policy, representing 3500 sellers operating on e-commerce marketplaces, such as Flipkart, Amazon, Snapdeal etc. MediaNama is compiling a list of submissions here.

Regulation of Marketplace Practices

  • A regulatory body for ecommerce: AIOVA has been demanding a regulatory body to monitor trade in e-commerce marketplaces and their policies towards sellers.
  • Protection of smaller market players and sellers: AIOVA says that smaller market players remain at a disadvantage without access to data to provide any innovative services. It asks for the inclusion of similar principles as have been included in the FDI policy, such as providing a level playing field, ensuring arm’s length transactions and non-discriminatory treatment. In the submission, it complains of the threat posed by biased, unregulated, and haphazardly managed marketplaces, both online as well as offline. It asks for principles to be laid out for internal policies and tariff structures of marketplaces.
  • Commission for looking into seller interest: Asks for the creation of a commission/body, constituted by industry leaders and economists, to receive concerns of sellers and submit its findings to the authority. It says that the policy leaves “hundreds of issues” unaddressed, and that sellers’ concerns have been completely excluded from consideration in the draft policy. The submission doesn’t illustrate which issues.

Economic Utility

  • Marketplaces as economic utilities: AIOVA asks for marketplaces to be considered as an economic utility instead of a private entity. It compares marketplaces to the securities market where shares are bought and sold, and states that any decision of a marketplace has an affect on the overall economic well being.
  • Authority and separate Rules to oversee violations by marketplaces: Asks for an authority to be set up to receive complaints against violations in market places, such as unjust policies and blacklisting policies. It asks the DPIIT to use the European Union’s Platform to Business (P2B) Rules on the conduct of platforms in relation to business activities carried out on their services, and bring about similar regulation in India.

On Counterfeiting Measures

  • Supports measures outlined in policy: AIOVA supports the anti-counterfeiting measures proposed in the draft policy. On specific points, the submission suggests some changes, including that the fFunction of imposing consequences for sellers’ violation of guarantee on authenticity of products should be fixed by a regulatory authority, instead of the marketplace provider.
  • Alternative dispute resolution mechanism for authenticity complaints: Asks for the creation of a judicial alternative dispute resolution institution. This would take appeals after a complaint of counterfeit goods from a consumer to a platform, where a seller may contest the claim.
  • Removal of the power of marketplaces to blacklist sellers as a measure against supply of counterfeit goods, as this would be open to abuse and arbitrary application, without proper investigation.

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