CAIT, Other Associations Call For Immediate Rollout Of Ecommerce Policy

Traders Body Confederation of All India Traders (CAIT), along with few other national associations, have called for an immediate roll out of ecommerce policy and formation of an empowered regulatory authority similar to bodies such as TRAI, SEBI.

At an Indian Trade conclave organised by the CAIT at New Delhi on Wednesday, some of the leading national associations related to traders, transporters, MSMEs, hotels and restaurants, travel, hawkers, mobile, FMCG, toys, electronics, direct selling, computer media, jewelers and others, pulled up against foreign ecommerce companies.

The CAIT and other organisations released a “Stakeholders E Commerce Delhi Declaration” XX announcing a five points Charter for both central and state governments demanding its immediate implementation.

“Till the Governments do not accept and implement the points raised in the charter, the nationwide agitation on these critical issues will be continued,” CAIT said.

The associations also demanded that ecommerce rules should be released under Consumer Protection Act and a fresh press note should be issued immediately.

CAIT Secretary General Praveen Khandelwal said it was decided in the conference that certain important fundamentals should be included in the ecommerce policy. One such suggestion said sellers registered on the marketplace should not be treated as the related companies of the marketplace. Also, it suggested marketplace platform entities shall not, directly or indirectly, control inventory of the seller and should not act as a whole-seller to their registered sellers.

“Marketplace ecommerce companies should not own brands or create their private label brands. Marketplace companies should not be allowed to exploit the provisions of FDI policy in Press Note 2 by registering their affiliate companies on their platform and allowing them to sell 25% of the goods. No Marketplace entity shall act as an inventory-based ecommerce entity. Similarly, no inventory-based ecommerce entity shall register any third-party seller,” he added.

The associations are also of the view that the banks should not be allowed to selectively provide offers or cashback on the marketplace platforms. Marketplace ecommerce companies must carry out strong KYC and due-diligence of sellers before on-boarding them so that they do not end up selling illegal products, they added.

Earlier also in December, CAIT asked the Centre to immediately launch an ecommerce policy and form a regulatory body for the sector. CAIT also urged the government to simplify the Goods and Services Tax (GST) and introduce a retail trade policy.

To avert these practices in the ecommerce sector, the report recommended an ex-ante regulation that will classify significant digital intermediaries on the basis of revenue, market cap, and user base.

The Department of Promotion of Industry and Internal Trade (DPIIT) is currently working on formulating an ecommerce policy. In June 2021, the government released draft ecommerce rules to better regulate the industry. While the final regulations are yet to be finalised, the government has held several rounds of discussions with stakeholders on various issues.

According to an Inc42 report, India’s ecommerce market is estimated to reach a size of $400 Bn by 2030 from $100 Bn currently. The total number of online shoppers is projected to rise to 350 Mn by 2025 from the present 165 Mn.