The PHD Chamber of Commerce and Industry (PHDCCI) has offered few suggestions to the Indian government on its FDI policy for E-commerce.
The Chamber has suggested that the foreign companies setting up only e-commerce marketplace platform should not have any direct or indirect control over the inventories. Therefore, the definition of group companies should be extended to include companies operating the marketplace platform itself, its group companies, its affiliates companies, its associated enterprises, its related parties, and any other person(s) controlled, directly or indirectly, by above or in which the person(s) in the companies mentioned above have any direct or indirect equity or economic participation in any manner.
The Chamber has recommended that the e-commerce marketplace entity having FDI should not be allowed to control inventory, directly or indirectly, as it tantamount to prohibited multi-brand retailing by foreign companies. PHDCCI also recommended that the permission to enter the B2B agreement should be clarified that the e-commerce marketplace entity and its group companies cannot sell those inventories that are purported to be sold by them on its marketplace.