100% FDI in e-commerce |
The government of India has given the green light to 100% FDI in the marketplace format of e-commerce retailing with a view to attract more foreign investments.As per the guidelines issued by the Department of Industrial Policy and Promotion (DIPP) on FDI in e-commerce, foreign direct investment (FDI) has not been allowed in inventory-based model of e-commerce.At present, global e-tail giants like Amazon and eBay are operating online marketplaces in India, while homegrown players like Flipkart and Snapdeal have foreign investments even as there were no clear FDI guidelines on various online retail models. The DIPP has also come out with the definition of `e-commerce`, `inventory-based model` and `marketplace model`.Marketplace model of e-commerce means providing of an IT platform by an e-commerce entity on a digital and electronic network to act as a facilitator between buyer and seller.The inventory-based model of e-commerce means an e-commerce activity where inventory of goods and services is owned by e-commerce entity and is sold to consumers directly.A marketplace entity will be permitted to enter into transactions with sellers registered on its platform on business-to-business basis.
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