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ARTICLE · 11 JANUARY 2019

Decoded Policy On Foreign Direct Investment In e-Commerce

King, Stubb & Kasiva
King, Stubb & Kasiva
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King, Stubb & Kasiva

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The e-commerce marketplace entity is restricted from mandating any seller to sell any product exclusively on their platform.

IndiaGovernment, Public Sector
Sindhuja Kashyap
Sindhuja Kashyap
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Introduction

On December 26, 2018, the Department of Industrial Policy and Promotion ("DIPP") vide Press Note 2 of 20181 ("Press Note") provided clarity to Foreign Direct Policy ("FDI") on e-commerce sector to the consolidated FDI Policy Circular 20172 ("FDI Policy"). The Press Note has brought in certain significant condition changes to the functioning and availing of FDI benefits by the e-commerce entities3 to ensure level playing by all the market players in the e-commerce sectors. Press Note maintains status quo on 100% FDI allowed under the automatic route for e-commerce entities engaged in the marketplace based model4 and no FDI is permitted in inventory based model5 of e-commerce.

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