No probe into alleged flouting of FDI norms by e-commerce companies: Commerce and Industry ministry
The commerce and industry ministry has decided against ordering a probe into the alleged violations of FDI norms by the e-commerce companies.
The ministry, however, said that a grievance redressal mechanism is being set up onlines of Twitter Sewa'to look into the complaints of the offline players.
Commerce and Industry Minister Nirmala Sitharaman said after getting representation from traders bodies like, CAIT, a meeting was convened to discuss the issue.
The minister also said "At this stage, we do not think that there is a case for ED".
The DIPP has asked online retailers to strictly comply with the e-commerce guidelines.
The ministry has received lot of complaints by stakeholders including traders body Confederation of All India Traders (CAIT).
Demanding immediate action, CAIT had filed a complaint with DIPP 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 Enforcement Directorate officials, Niti Aayog, Consumer Affairs and the Department of Industrial Policy and Promotion (DIPP).
She said on the lines of the 'twitter seva' of this ministry, "there is now going to be grievance redressal akin to the (hashtag) '#mociseva' which will have the consumer affairs people on board".
The minister said people can raise their issues on this and the ministry's team along with the officials of the consumer affairs would respond to those complaints.
The DIPP would train the staff of the consumer affairs on handling such grievances taking on board the e-commerce companies alleged to have hurt the traders.
Further she said DIPP Secretary Ramesh Abhishek has also discussed the matter with e-commerce companies and has asked them not to violate e-commerce guidelines.
"Some companies responded that they are not giving those discounts. We are still a marketplace model, the companies (vendors) whose products are coming on their (platform) are giving that and it is not violative of the policy," she said adding the e-commerce would also nominate a officer who would respond to such grievances.
She added the grievance redressal will temporarily be part of '#mociseva' and after that the consumer affairs officials will go back and start operating themselves.
The Consumer Affairs Ministry should actually be attending to such grievances coming on the issue of e-commerce because its a commercial transaction between a consumer and a company, she said.
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.