E-commerce norms should treat domestic and foreign players alike

January 06, 2019, New Delhi

“Government may not be wrong in its clarificatory policy on Foreign Direct Investment (FDI) in e-commerce, as it was a case of backdoor entry in Multi-Brand Retail Trade (MBRT). But vital issues remain to be resolved to promote healthy economic democracy”, said Pradeep S Mehta, Secretary General, CUTS International.

“However, the issue of creating a level playing field between domestic and foreign players in retail sector is yet to be resolved, for which a comprehensive National e-Commerce Policy is need of the hour”, said Mehta who is a member of the Government of India’s Think Tank on e-commerce.

The present norms (Press Note 2/2018) are applicable only on foreign platforms which raise certain concerns – will this discriminatory treatment between foreign and domestic platforms not affect India’s effort towards promoting a competitive economy?

At the time when protectionism is looming large on global economy, such discrimination would undermine any effort to counter it, asserted Mehta.

The new guidelines are stricter for e-commerce companies with FDI providing marketplace, but there are no such restrictions for companies without FDI. Thus, it creates an uneven playing field.

Further, online vendors’ concern of discriminatory treatment by present and upcoming domestic ecommerce platforms remains to be addressed.

Be that as it may, India does not need a separate regulator for e-commerce, which would be yet another parking place for retired babus who are generalists and turn into controllers.

Most of the malpractices adopted by e-commerce platforms, for instance, discrimination among its vendors, deep discounts etc., can be dealt by the Competition Commission of India. If need be, the Competition Act, 2002 can be tweaked for which the process is going on.

Additionally the Consumer Protection Bill, 2018, which is likely to be passed soon by the Rajya Sabha, also has specific provisions on e-commerce.

Rules of the game should be fair and non-discriminatory to all players in the retail sector.

For further details, please contact:

Sanjay Mangla; skm@cuts.org

Ujjwal Kumar; ujk@cuts.org