The new rules are expected to have an impact across the board in an e-retail market India forecasts will be worth $200 billion by 2026
India’s Ministry of Consumer Affairs outlined plans on Monday which include limiting “flash sales” by online retailers, reining in a private label push, compelling them to appoint compliance officers and impose a “fall-back liability” if a seller is negligent.
The new rules are expected to have an impact across the board in an e-retail market India forecasts will be worth $200 billion by 2026, with players including from Tata’s BigBasket, Reliance Industries’ JioMart and Softbank-backed Snapdeal to market leaders Amazon and Flipkart.
The rules are the latest in a growing confrontation between U.S. tech giants and New Delhi over a host of policy-related issues which are seen by some as protectionist.
“The rules will have a wider impact on all forms of e-commerce and will increase business costs. Entities, even beyond big players, are analysing the policy and will share concerns with the government,” Arjun Sinha, a partner at Indian law firm AP & Partners, told Reuters.
The companies have until July 6 to respond to the proposals, after which time they may be reviewed further or implemented.
Snapdeal said it was reviewing the rules. BigBasket declined to comment. Reliance did not respond to a request for comment.
One aspect of the proposed new rules which is likely to have a particular impact is one which gives the customer “suggestions of alternatives to ensure a fair opportunity for domestic goods” if a retailer is showing imported goods for sale.