Home / Knowledge / News / Textiles / RBI, ED to probe if e-tailers flouted FDI norms
RBI, ED to probe if e-tailers flouted FDI norms
02
Nov '15
There may be trouble ahead for e-commerce majors such as Flipkart, Snapdeal and Amazon with the Commerce Ministry requesting the Enforcement Directorate (ED) and the Reserve Bank of India to examine whether the e-tailers violated foreign direct investment (FDI) rules by engaging in business-to-consumers (B2C) activity, according to media reports.

The Commerce Ministry decision comes on the heels of a complaint filed by traders' body Confederation of All India Traders (CAIT) which alleged that the e-commerce players circumvented law and engaged in B2C activity while 100 per cent FDI is allowed only in the business-to-business (B2B) segment.

“It's requested that the matter may be examined and appropriate action may be taken,” said the Commerce Ministry said in a letter addressed to the ED and the RBI. CAIT had complained that stated that the three e-commerce majors, which recently conducted mega sales, solicited the general public through a multi-media advertisement blitz.

“Since they have received foreign investment, they are allowed to undertake B2B e-commerce activity and not B2C. The said advertisements addressed to the public in general tantamount to retail trading,” CAIT said in its complaint to the government.

CAIT had alleged that e-commerce companies have solicit general public into their respective sales by big advertisement campaign on print, electronic and social media.

CAIT further said that these companies claims to be a marketplace and therefore can provide only a technology platform for the sellers and not offer 'sale' or 'discounts'.

The traders' body also argued that that since ownership of inventory is not held by the e-commerce companies, they cannot offer sale or discounts in totality on their portals. “Doing so establishes that they are not marketplace and as such openly flout FDI policy,” it added. CAIT appealed to the government to restrict Flipkart, Amazaon and Snapdeal from conducting such sales and take immediate steps against them for violating the Consolidated FDI Policy. (SH)

Fibre2Fashion News Desk - India


Must ReadView All

US commerce department finds dumping of low melt PSF

Textiles | On 20th Jun 2018

US commerce department finds dumping of low melt PSF

The US department of commerce (USDC) has announced affirmative final...

Courtesy: Aditya Birla

Textiles | On 20th Jun 2018

'Growth of VSF yarn industry is difficult'

Growth for the viscose filament yarn (VSF) yarn industry is...

Comfort USP of Sensitive Fabrics range of Eurojersey Spa

Apparel/Garments | On 20th Jun 2018

Comfort USP of Sensitive Fabrics range of Eurojersey Spa

Italian company Eurojersey Spa will present in 2019 new embossing...

Interviews View All

Mohammad Mamun Ar Rashid
UL VS Bangladesh Ltd

Productivity, creativity and innovation play a vital role in the growth of ...

Top executives
Textile industry, India

The event should be organised every year

Karan Suratwala
Key Textile Accessories Private Limited

Chinese imports are destroying the supply chain

Paolo Crespi

For.Tex is an Italy-based leading producer of dyes and thickeners, and is...

Rajat Jaipuria

Activewear brand Soul Space promotes organic cotton farming and...

Urmil Arya

Sushila International, a well established textile organisation established ...

Eamonn Tighe
Nature Works LLC

Eamonn Tighe, Fibres and Nonwovens - Business Development Manager of...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Larry L Kinn
Suominen Corporation

Larry L Kinn, Senior Vice President - Operations Americas of Suominen...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Sidharth Sinha
Sidharth Sinha

<b>Sidharth Sinha</b> has contributed to the successful rebirth and...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


June 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Advanced Search