After a long wait and a lot of deliberation, the Department for Promotion of Industry and Internal Trade has finally come up with another draft of the National E-commerce Policy (“New Draft Policy”), made available on the public domain for consideration, comments and suggestions. Comments can be sent at goonjan.kumar@gov.in. and the last date for receiving comments is 9th March, 2019.
Unlike in the previous draft that we had come across, the New Draft Policy does not completely encourage 100% Swadeshi marketplaces for holding inventory, even though it does promote the Make in India movement. We also don’t see the restrictions on deep discounting in the new Policy. We can say that the new Policy is much more liberal and accepting when these two points are concerned.
The e-Commerce sector is primarily driven by technology and data. In a consumer oriented developing country like India, there is a continuous evolvement in technologies and volumes of data is generated every single second. So, India certainly requires an enabling regulatory framework for empowering domestic entrepreneurs, leveraging access to data, connecting Micro Small and Medium Enterprises, vendors, traders, etc. to the digital ecosystem as well as empowering consumers to retain control of the data generated and owned by them.
Aims of the National E-Commerce Policy:
- Create a facilitative regulatory environment for growth of e-commerce sector and empower domestic entrepreneurs;
- Encourage Make in India and safeguard the interests of the consumers.
- At the same time, leverage access to data, mainstreaming the segments of our economy.
- Empower Micro Small and Medium Enterprises (“MSMEs”), vendors, traders through skilling and providing institutional support to familiarize them with technology;
- Promote domestic research and development in digital innovation in order to foster homegrown alternate, cheaper and efficient service providers suited for the Indian market, including those in digital payment processes, like RuPay and BHIM so that domestic players in the Indian market are able to sustain in the digital economy;
- Stimulate the participation of MSMEs, start-ups and traders in the digital economy.
Key Highlights:
- All e-commerce sites/apps available for download in India must have a registered business entity in India as the importer on record or as the entity through which all sales in India are transacted. This is important for ensuring compliance with the existing laws and regulations for preventing deceptive and fraudulent practices, protection of privacy, safety and security.
- All e-Commerce sites/apps available to Indian consumers (displaying prices in Indian Rupee) must have Maximum Retail Prices on all packaged products, physical products and invoices. Department of Consumer Affairs would evaluate violations and decide corrective actions for such sites/apps.
- Consumer/Business Payments from Indian banks and payment gateways to unauthorized and unregistered (Goods and Service Tax non-compliant) sites/apps will be barred.
- As a transparency requirement, e-commerce entities would be mandated to make a full disclosure to the consumer regarding the purpose and use of data collection upfront, in a simplified and an easily understandable form on their websites/ application interfaces.
- Trade mark (“TM”) owners will be given the option to register themselves with e-commerce platforms. Whenever a trade-marked product is uploaded for sale on the platform, the platform will have to notify the respective TM owner. This facility will be put in place by platforms and made available for interested TM owners.
- Sellers must provide an undertaking to the platform/site/application that they are not engaged in transacting in such products that are prohibited by theDirector General of Foreign Trade or any other competent authority, on their site.
- The liability of the platform in case used for sale of prohibited goods will be determined as per provisions of law.
- Participants of the digital economy that have access to the data of Indians must nominate a local representative to be responsible for the affairs of the company in India.
- Issues related to payment processes and other financial transactions which are inherent to e-commerce will be addressed in order to prevent data-leaks/theft, protect privacy and sensitive data, and enabling secured transactions.
- The Foreign Direct Investment Policy in e-commerce has been developed in order to ensure that the marketplace provides a level playing field to all participants, while ensuring that distortionary effects, either through means of price control, inventory or vendor control does not happen. A situation of capital dumping is to be strongly discouraged.
Source: Department for Promotion of Industry and Internal Trade
