Government Tightens Ecommerce Norms

The Government of India tightened the norms for online ecommerce companies. The policy affects companies such as flipkart and amazon, who have foreign investments.

The policy issued by the commerce and industry ministry  bans selling products of companies where they hold stakes and banned exclusive marketing arrangements that could influence product price. The policy makes sure that all vendors would have equal opportunities and services without any discrimination.

The revised norms aim to protect local vendors and domestic players who face tough competition from big money foreign companies. The policy would come into effect from February, 2019.

Vendors and its sister companies together can’t sell more than 25% of a products on such portas.

Same services to all vendors without any discrimination must be provided it includes logistics, warehousing, advertisement, marketing, payments, financing etc. The ecommerce firms will have to furnish an audit report to the RBI every year in this regard.

The GOI made the move after several domestic traders suffered heavy losses because ecommerce companies provide huge discounts to online customers. However traders still want a definitive policy, regulation and monitoring in the ecommerce space.