New Delhi: The commerce ministry has requested the enforcement directorate and RBI to look into the complaint of retailers that e-commerce majors like Flipkart and others who are violating FDI rules by engaging in business-to-consumers (B2C) activity. Confederation of All India Traders (CAIT) had complaint that e- commerce portals are circumventing the law and are engaged in business to consumers (B2C) activities as 100 per cent FDI is allowed only in the business-to-business (B2B) segment.
“It’s requested that the matter may be examined and appropriate action may be taken,” said a letter by the ministry addressed to ED and RBI. CAIT had alleged that e-commerce companies have solicit general public into their respective sales by big advertisement campaign on print, electronic and social media. “Since they have received foreign investment as such they are allowed to undertake B2B e-commerce activities and not business to consumers (B2C). The said advertisements addressed to the public in general tantamount to retail trading,” said CAIT. The CAIT further said that these companies claims to be a marketplace and therefore can provide only a technology platform for the sellers and not offer ‘sale’ or ‘discounts’.
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