E-commerce policy likely to be announced before February 25, says CAIT

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Published: February 9, 2019 6:03:14 PM

Government told CAIT that it will assess the impact of the e-commerce policy and will constitute the regulatory authority for e-commerce if required.

Department for Promotion of Industry and Internal Trade (DPIIT) will first regulate the e-commerce policy.

The e-commerce policy is expected to be announced by the government before February 25, traders’ body CAIT national secretary general Praveen Khandelwal told FE Online.

The senior officials of the Ministry of Commerce and Industry, however, assured CAIT on February 8 that the policy is almost ready and will be announced “shortly”, Khandelwal said.

He was also told by the officials that the government will assess the impact of the e-commerce policy and will constitute the regulatory authority for e-commerce if required.

“In all fairness, the impact of the policy should be evaluated after a month’s time,” added Khandelwal.

He said that the Department for Promotion of Industry and Internal Trade (DPIIT) will first regulate the e-commerce policy but if it is unable to do so then only a regulatory authority will be set up.

Internal trade, earlier managed by Ministry of Consumer Affairs was brought under the ambit DIPP (Department of Industrial Policy and Promotion) to reportedly ensure coordination among both internal and external trade by the Ministry of Commerce and Industry.

DIPP is now renamed as Department for Promotion of Industry and Internal Trade (DPIIT).

“While it is under DPIIT now but I don’t think they would be able to manage the policy. Sooner or later they will have to constitute the authority to monitor the e-commerce business,” said Khandelwal.

Soon the issues of DPIIT will be discussed by the ministry with traders to take suitable steps to solve their issues, Khandelwal further said adding that a national trade policy for retail trade will also be worked out.

The expected e-commerce policy follows the revised FDI guidelines in the sector that was implemented on February 1 despite the extension sought by Amazon and Flipkart to comply with them.

Amazon had to withdraw goods sold by one of its largest sellers – Cloudtail, in which it has stake, from its marketplace platform following the revised norms.

However in a week’s time, shareholding in Cloudtail (subsidiary of Prione Business Services which is a joint venture between NR Narayana Murthy’s Catamaran Ventures and Amazon) was tweaked.

While Catamaran Ventures increased its stake in Prione, Amazon brought its control down from 49% to 24% stake that ceased Cloudtail to be Amazon’s group company, PTI quoted sources as saying.

As per the guidelines, that the goods of a vendor will be deemed to be controlled by an e-commerce marketplace if more than 25% of purchases of such vendor are from the marketplace entity or its group companies.

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