Bengaluru, March 28
Singapore-headquartered social commerce company, Shopee has shutdown its India operations from March 29, after almost six months of its India foray.
“SEA Limited (Shopee’s parent entity) and India management team of Shopee held a town hall earlier today to inform employees about the closure. The reason for closure is that SEA management did not see long term sustainable growth for Shopee in the India market,” a source close to the company told BusinessLine. SEA Limited is Singapore’s largest publicly traded company.
Shopee India is estimated to have around 280-300 employees. Another company source, who spoke to BusinessLine on the condition of anonymity, noted that all employees have been offered 3 months salaries as severance. In addition to the severance package, the company has also given assets like laptop and mobile to employees. They are also given relocation benefits to return to their hometown in case they were working from office.
“Rest assured that all orders placed before this date will continue to be fulfilled as usual, and after-sale services and support will continue to be available to all users who have made purchases on our platform,” Shopee said in a notice to users.
Further, the sellers associated with Shopee were also assured that Shopee Seller Centre, including payment withdrawal and disputes for returns, will be available until 30 May, 2022. Funds held in escrow for ongoing orders will be released as per usual process and income corresponding to orders that are not yet completed will be credited to the month of April, the company added.
Shopee did not respond to BusinessLine queries till the time of publication.
Seller collectives welcome move
Shopee’s entry into India has always garnered criticism from sellers’ collectives for its alleged investor and promoter connections to China. In September 2021, CAIT had written to Prime Minister Shri Narendra Modi demanding ouster of Shopee owned by SEA group. The federation has also followed up with the Ministry of Finance and Ministry of Commerce, on its concerns about Shopee.
CAIT noted that SEA Holdings (the holding company of Shopee) has significant ownership (almost 25 per cent) by Tencent (Chinese investment firm). Also, CAIT alleged that the founder of SEA, Forrest Li is originally Chinese, but became Singaporean only a few years back. “SEA uses Tencent cloud to store data. Also, SEA’s gaming subsidiary, Garena licenses most games from Tencent leading to huge royalties and the investment ensures that there is significant control and access to data,” it added.
Accused of violation
Today, reacting to the Shopee’s decision to exit India, Praveen Khandelwal, Secretary General of The Confederation of All India Traders (CAIT) said “any company which will violate the sovereign law of the country and breaching data collected from India shall meet the same fate.”
Adding to this, Abhay Mishra, President, PRAHAR (Public Response Against Helpnesses and Action for Redressal) said, “The decision of Tencent controlled SEA Limited to completely exit India with the shutting down of Shopee and Garena Free Fire is a vindication of our fight against Chinese controlled companies. We call upon Tencent to shut down another of its puppet arm - BGMI/PUBG. In case. Tencent does not shut down BGMI on its own, the government of India should immediately ban BGMI/PUBG in the interest of sovereignty and integrity of India and security of the state,”