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Strictly comply with FDI guidelines: Government to online companies

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The Government has ordered e-tailers and online marketplaces to strictly comply with the e-commerce guidelines following complaints by offline retailers on advertisements being given by the former in newspapers announcing sales.

Strictly comply with FDI guidelines: Government to online companies
Demanding immediate action, CAIT had filed a complaint with DIPP alleging that major e-tailers are blatantly violating FDI norms.

“In a recent meeting at the Commerce and Industry Ministry, it was made clear to online companies that they can not announce any kind of sale discounts and if they are giving advertisements, then it should clearly mention that those discounts are extended by their vendors and brand owners only,” an official was quoted by PTI as saying.

The official further told PTI that the Ministry has received lot of complaints by offline stakeholders including traders body Confederation of All India Traders ().

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Demanding immediate action, CAIT had filed a complaint with alleging that major e-tailers are blatantly violating FDI norms.

It has stated that during the past few days companies have given big advertisements in media announcing sale on their online platform which is a violation of FDI guidelines on e- commerce.

The meeting was attended by Secretary in the Department of Industrial Policy and Promotion (DIPP) Ramesh Abhishek, the consumer affairs secretary and some big online retailers.

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In March, the Government had allowed 100 per cent FDI through automatic route in the marketplace format of e-commerce retailing.

As per the guidelines issued by the DIPP, foreign direct investment (FDI) has not been permitted in inventory-based model of e-commerce.

The guidelines also states that such entities will not directly or indirectly influence the sale price of goods and services and shall maintain level playing field.

“E-commerce guideline allows owner of inventory that is seller registered on marketplace to determine price including by giving discount,” another official was quoted by PTI as saying.