The Confederation of All India Traders (CAIT) has released a 14-point charter demanding tighter measures in the draft E-commerce Rules at a meeting attended by major e-commerce industry stakeholders and 12 national-level traders’ associations.

CAIT’s recommendations include stricter rules for marketplaces, KYC for sellers being onboarded, and banks being restricted from allowing selective cashback offers. The traders’ body also asked for an independent e-commerce regulatory body.

While Walmart-owned Flipkart and Amazon chose to skip the conclave, top executives from ITC, Hindustan Unilever, Coca-Cola, Amway, Udaan, Urban Ladder, Big Basket and Reliance attended the conference, CAIT said.

Marketplace rules

“Irrespective of foreign or Indian e-commerce marketplaces, sellers registered on the platform should not be the related companies of the marketplace. The marketplace should not act as a whole-seller to registered sellers. Marketplace e-commerce companies should not own brands or create their private label brands,” CAIT’s pointers said.

It added, “No marketplace entity shall act as an inventory-based e-commerce entity. Similarly, no inventory-based e-commerce entity shall register any third-party seller. Marketplace e-commerce companies must carry out strong KYC and due diligence of sellers before on-boarding them so that they do not end up selling illegal products.”

Additionally, it re-emphasised the draft e-commerce rules’ points around platforms sharing sellers’ contact details and nominating information on the Grievance Officer, Nodal Officer and Compliance officer.

Praveen Khandelwal, National Secretary General, CAIT told BusinessLine, “We are also setting up a task force of 150 national associations and chamber of commerce bodies across the states by February 15. We will be running campaigns on the importance of e-commerce and why it is necessary to digitise. While we are in talks with the government to implement the policy at the earliest, we will also plan a national agitation if needed.”

Khandelwal also spoke about relaunching an updated version of its Bharat eMarket in March, though he didn’t specify details on business model and commissions charges as things are still in talks.

Violation of FDI laws

Alleged violation of various FDI policies by top e-commerce players, including Flipkart and Amazon, has been a key contention of CAIT. It also added its pointers, “Marketplace companies should not be allowed to exploit the provisions of the FDI policy in Press Note 2 by registering their affiliate companies on their platform and allowing them to sell 25 per cent of the goods.”

“They created a 14-point charter and are setting up a task force. It is no different from what they have been saying . They (CAIT) want to do away with deep discounting, but the government marketplaces have been providing even more discounts as seen in the Economic Survey 2022. It is very clear that the seller decides on how much discount to offer. It has nothing to do with the e-commerce marketplace,” a senior executive from a top e-commerce platform told BusinessLine seeking anonymity.

 The Economic Survey 2022 shows a comparison of select product prices on the government’s e-Marketplace versus Amazon. Introduction of this platform has reduced procurement costs for the government. “The use of this e-marketplace has resulted in a substantial reduction in prices in comparison to the rates used earlier, with average prices falling by at least 15-20 per cent, up to 56 per cent,” the document said.

“Regarding the FDI laws, it needs to be uniform for both Indian and domestic players. It can’t be a different rule book for the top Indian e-commerce players and retailers who, too, have got major foreign funding,” the executive added.

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