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India asks e-com firms to report FDI compliance annually

07
Dec '19

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India has made it mandatory for e-commerce companies to submit firegn direct investment (FDI) policy compliance report by a statutory auditor by September 30 every year, according to a government gazette notification issued on December 5. The move is being widely perceived as a step to ensure proper compliance of all FDI norms by these companies.

"Against Sl. No. 15.2.3, for entry (p), the following entry shall be substituted, namely-(p) e-commerce marketplace entity with FDI shall have to obtain and maintain a report of statutory auditor by 30th of September every year for the preceding financial year confirming compliance of the e-commerce guidelines," a news agency reported quoting the gazette notification.

Section 15 of the Foreign Exchange Management Act (FEMA) deals with e-commerce companies.

Indian traders’ bodies have been raising their voice against alleged violation of FDI norms by several e-commerce companies.

The Confederation of All India Traders (CAIT), which often complained about predatory pricing and discounts, asked the government has requested the government to make it mandatory for e-commerce companies to obtain a compliance certificate by March 31 to be able to raise funds.

Commerce and industry minister Piyush Goyal had earlier cautioned e-commerce companies of strict action if they do not halt predatory pricing on their platforms flouting FDI rules.

Fibre2Fashion News Desk (DS)

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