Do you wait for “Flash Sales”, “Independence Day Sale”, “Diwali Sale”, or other types of big discounts sale to buy different items? If yes, then your wait may not end from now onwards! The Indian government is proposing a complete ban on such e-commerce events. Currently, the proposed draft is waiting for consumers’ feedback to know their opinions.
What are the other e-commerce amendment and how it will affect the e-commerce giant? To know the detail, let’s go through the article.
India Proposes Strict E-commerce Rules
On Monday, India’s Ministry of Consumer Affairs has given a big jolt to e-commerce giants like Amazon, Flipkart by banning mischievous flash sales. The Ministry also proposed that e-commerce firms can’t put their affiliate companies as the seller on the e-commerce platform.
The offline retailers in India are complaining against malpractices done by e-commerce firms to attract customers. Finally, the ministry has considered their requests to amend the e-commerce rules.
Why flash sales are not good? How e-commerce giants are cheating? Answering these questions, the ministry said:
“Certain e-commerce entities are engaging in limiting consumer choice by indulging in ‘back to back’ or ‘flash’ sales wherein one seller selling on the platform does not carry any inventory or order fulfillment capability but merely places a ‘flash or back to back order with another seller controlled by the platform. This prevents a level playing field and ultimately limits customer choice and increases prices.”
Indian ministry has also asked the e-commerce firms to identify the origin of the listed items for sale. And as per the new rule, priority should be given to domestic goods.
How Things are Becoming Tough for e-commerce Giants?
In addition to the above rules, the ministry has also asked the e-commerce firms to appoint a chief compliance officer, a nodal contact person who will be available for law enforcement agencies whenever required. The ministry also directed the e-commerce firms to appoint a resident grievance officer to solve consumer issues.
Talking about the above rules, the Indian ministry stated:
“This would ensure effective compliance with the provisions of the Act and Rules and also strengthen the grievance redressal mechanism on e-commerce entities.”
It further added:
“for the purposes of verification of identity, or for the prevention, detection, investigation, or prosecution, of offenses under any law for the time being in force, or for cybersecurity incidents.”
The above rules will make things quite difficult for Amazon, Flipkart, and other e-commerce giants. They will get busy in the bureaucratic activities and it will harm their corporate operations.
The government also asked them to submit all buying/selling details at an interval of 3 days to analyze the data.
Current rules will also disallow e-commerce firms. Most of the products available on e-commerce websites come from joint venture firms. India made it illegal in new amendments. As ministry indicated that:
“Ensure that nothing is done by related parties or associated enterprises which the e-commerce entity cannot do itself.”
When contacted, Amazon said that a house review is going on related to new policies. Flipkart did not comment anything on the draft proposal of the Indian ministry.
