The upcoming draft e-commerce policy which The Economic Times has reviewed said the government will inform from time to time notify which parties fall under the definition of associates and related parties.
The government is looking to extend more restrictions placed on large e-commerce marketplaces such as Amazon and Walmart-owned Flipkart to their associates and related parties to curb alleged circumvention of foreign direct investment FDI and anti-competitive activities by these players.
A leaked copy of the upcoming draft e-commerce policy which the Economic Times has reviewed said the government will form time to time. Actions and things that cannot be done by the platform entities can also not be done by any of its associates and related parties,” read the draft e-commerce policy.
India’s e-commerce FDI rules don’t allow for online marketplaces to hold inventory of their own or influence the price of goods sold and prohibit group companies or entities in which marketplaces.
According to Economic times report, If the government can at any time, change its definition of related parties , forcing us to restructure our business that does not create very conductive environment.
We will need to see if this policy passes the test of well-established competition laws. the leaked draft ecommerce policy said the government will aim to ensure there as more service providers available to consumers and sellers to ensure no monopolies are created.