CAIT demands regulatory authority for online retailers

Alleging that ecommerce firms are openly flouting norms laid down under FDI, traders’ body CAIT today demanded formation of a Regulatory Authority for India’s online retail market.

In a letter to Commerce Minister Nirmala Sitharaman, Confederation of All India Traders (CAIT) said,

“Ecommerce companies are openly flouting norms laid down under FDI in ecommerce policy of the government and in absence of any specified rules & regulations are grossly involved in deep discounts, predatory pricing, anti-competitive practices, tax avoidance etc.”

A joint statement by CAIT National President B C Bhartia and its Secretary General Praveen Khandelwal said that although ecommerce has introduced significant choices for Indian consumers and customers, it has also given rise to many disputes by the consumers purchasing the products from ecommerce websites.

“Since it is a promising business market in the future due to steep rise in internet connections and mobile connectivity, formation of a Regulatory Authority and specified Rules & Regulations are all the more required before the situation becomes more worsen. Already, the e commerce companies have vitiated the e commerce market to a great extent,” they said.

The traders’ body further alleged that ecommerce websites are “not following Indian laws at all and are adopting unfair means to grow their business which is creating an uneven level playing field much to the disadvantage of brick & mortar shops resulting into diversion of their customers to e commerce market”.

Khandelwal said that in response to a tweet made to DIPP on contravention of FDI guidelines by ecommerce companies, the DIPP on May 10 tweeted that it is responsible for formulation of FDI policy and violation of FDI policy is a part of FEMA which is administered by Reserve Bank and Enforcement Directorate is the enforcement agency.

“Taking advantage of such provisions and loopholes, the ecommerce players have made ecommerce market a free play ground playing the game with their self set rules. Therefore, in order to create a structured and healthy ecommerce market in the country, formation of a Regulatory Authority and specified Rules & Regulations must be made by the Government-argued both leaders,” Khandelwal said.