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DPIIT Meeting: CAIT calls for TRAI-like regulator for e-commerce, Reliance wants tighter rules for marketplace platforms

Not a lot of fresh issues were raised at the meeting as many chose to reiterate concerns involving foreign e-commerce platforms.

A traders association called for a regulator like TRAI for e-commerce, and a domestic e-commerce giant called for tighter regulations for foreign marketplace platforms at a virtual meeting held on January 18 by the Department for Promotion of Industry and Internal trade (DPIIT) to discuss the proposed e-commerce policy.

The meeting was attended by various stakeholders, including domestic and foreign e-commerce companies, associations representing traders and retailers, and associations related to the MSME sector.

The government proposed amendments to the E-Commerce Rules last June in response to repeated antitrust complaints against e-commerce giants Amazon and Flipkart, but it appears that the government is yet to finalise the proposed rules and is still reviewing and soliciting feedback from concerned stakeholders.

What do retailers and traders want?

Speaking on behalf of retailers and traders, the Confederation of All India Traders (CAIT) asked for the following, according to a press release:

  1. Regulator like TRAI: CAIT asked for a regulator like the Telecom Regulatory Authority of India (TRAI) for the e-commerce sector
  2. Robust and unambiguous policy: The traders’ body also called for a “robust and unambiguous” e-commerce policy in light of the fact that provisions of Press Note 2 are repeatedly violated by foreign e-commerce platforms. “The e-commerce policy should have clear stipulations about transparent operations of e-commerce platforms, easy accessibility and adequate grievance redressal system, non-discriminatory access of marketplace platforms to all stakeholders and value chain, avoidance of conflict of interest between marketplace platforms, sellers and various service providers on the platform,” CAIT submitted.
  3. Mandatory registration of e-commerce companies and KYC for sellers: CAIT also advocated for mandatory registration of all e-commerce entities operating in the country as well as strict KYC norms for sellers.
  4. Cover sales through social media as well: The e-commerce regulations must cover goods and services sold through any digital mode including social media platforms, social commerce, WhatsApp groups, etc, CAIT submitted.
  5. Removal of mandatory GST number: Along with others, CAIT asked that the mandatory requirement for sellers to obtain a GST number before selling products on any e-commerce portal, be removed as it restricts small traders, artisans, craftsmen, karigars from exploring e-commerce.

What does Reliance want?

According to a Reuters report, domestic e-commerce player Reliance asked for the following at the meeting:

  1. Tighter regulations for marketplace e-commerce platforms: Reliance called for tighter regulations of marketplace platforms, which are platforms that do not own inventory but instead facilitate a place for sellers and buyers to meet such as Amazon and Flipkart. While foreign platforms can only operate marketplace platforms, Reliance, on the other hand, can directly sell to customers.
  2. Non-discriminatory treatment of sellers: Specifically, Reliance sought regulations to ensure “non-discriminatory” treatment of sellers on marketplace platforms.

“It appeared Reliance is pushing the government hard (on regulations) so that they succeed in ecommerce,” an e-commerce executive who attended the meeting told Reuters.

Who all attended the meeting?

Apart from Reliance and CAIT, the meeting was attended by All India Consumer Products Distributors Federation (AICPDF), Retailers Association of India (RAI), Laghu Udyog Bharti, Federation of Small Industries (FISME), Amazon, Walmart-owned Flipkart, Tata, Udan, Pepperfry, Shopclue, and Snapdeal, CAIT said in its press release.

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While there weren’t a lot of fresh concerns raised by these entities, many of them reiterated that foreign e-commerce platforms are continuing to violate FDI norms and creating an unfair playing field by getting early access to new products in top-selling categories like smartphones, engaging in deep discounting, and selling through few preferred sellers that are affiliated with the company, Economic Times reported.

“We reiterated the issues raised earlier—deep discounting, private labels and FEMA violation. The government should take action against such players and come clean on these issues through a policy.” – Ashwani Mahajan, national co-convenor of Swadeshi Jagran Manch told ET

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