CMAI Welcomes Clarification on E-commerce Marketplace Policy
The Clothing Manufacturers Association of India (CMA) heartily thank the Government, especially PMO, Commerce and Textiles Ministry for implementing the much-awaited Policy related to E-Commerce Marketplace, which will bring Level Players for all Domestic Retailers.
The Government of India has clarified this Policy, originally issued on 29th March 2016 through a press note dated 26th December 2018. DIPP has reaffirmed its Policy, restricting Marketplace Companies from using FDI flow for “Retail”.
DIPP has further clarified, that Marketplace Operators Cannot Participate in Pricing or Inventory models through any permissible structures like B2B Wholesale, Group Company Structures etc. thus removing all ambiguities in the interpretation of the Policy. Additional clarification, Restricting “exclusive” Product deals including Private Labels etc., further reaffirms the Policy’s intent to not allow any FDI in “Inventory-Based E-Commerce”
Mr Rahul Mehta, President through a Press Release stated that with these clarifications, Marketplaces will only act as Facilitators of the Transaction and not be Responsible for the Actual Product. All Product Sales facilitated by Marketplaces will be a Contract between the Customer and the actual Seller.
The Policy has further mandated the filing of Statements by Marketplaces, to affirm Compliance of Rules.
Mr Mehta also stated that this new Clarification will bring much needed Level Playing Field for Sellers on Marketplaces. With complete Restriction on Marketplaces to participate directly in Retailing, the Policy will give Indian Companies the opportunity to build a Stronger Retail Models and avoid Channel conflicts.
Mr Mehta further stated that the Indian Companies will get the opportunity similar to what the Chinese Companies received initially, which led to the building of Giants like Alibaba, Tencent and JD.
Mr Mehta further requests the Government to Appoint Monitoring Agencies to ensure Compliance to Norms and initiate action against Marketplaces that flout the Policy.
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