CMAI hails clarification to e-commerce policy

The Clothing Manufacturers Association of India (CMA) has thanked the Government, especially PMO, Commerce and Textiles Ministry for implementing this much-awaited Policy, which will bring level players for all domestic retailers

The Government of India has clarified the Policy related to E-Commerce Marketplace, originally issued on March 29, 2016, through a press note dated December 26, 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”.

Rahul Mehta, President 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 Market places 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.