India rolls out new regulation to ban e-commerce sites from selling exclusive products in which they hold equity

[Fowlmove]

A tech news from India on a rather interesting regulation which prohibits e-retailers like Amazon and Flipkart from selling exclusive products in which they have equity or signing agreements with sellers for exclusive rights. Read for more info :

India tightens e-commerce rules, likely to hit Amazon, Flipkart

EDIT:
Cached page of the actual regulation:

Review of policy on Foreign Direct Investment (FDI) in e-commerce

[blackfire]

Im not sure I understand the point of this. Don’t all e sellers make own brand stuff? Who else is going to stock Amazon basics. Or does this just prevent them from not allowing someone the choice to stock it?

[AnotherDev]

Im not sure I understand the point of this. Don’t all e sellers make own brand stuff?

I’m afraid I’m in the same boat as you So, Gap can’t sell in India? They make Gap brand clothes.

Also, the lawyer speak/circular points:

“An entity having equity participation by e-commerce marketplace entity or its group companies, or having control on its inventory by e-commerce marketplace entity or its group companies, will not be permitted to sell its products on the platform run by such marketplace entity,” the commerce ministry said in a statement.

Such language.

The All India Online Vendors Association (AIOVA) in October filed a petition with the anti-trust body Competition Commission of India (CCI) alleging that Amazon favours merchants that it partly owns, such as Cloudtail and Appario. The lobby group filed a similar petition against Flipkart in May, alleging violation of competition rules through preferential treatment for select sellers.

Allegedly. Would be great to see proof of this. They probably can’t afford to lawyer up, though, so they’re crippling them with regulations.

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However, on the other side of the coin, I suppose this is akin to Haiti throwing Monsanto goods into the harbor after their catastrophe.

[Fowlmove]

Retailer are getting exclusive sales rights with the manufacturers of sought after goods for exclusive sales rights, this has been happening too often and in part is causing losses to small a mid sized business.

The mid & small cap industries have been fighting the big companies who are growing ever larger, acquiring and killing off competition. There were like a dozen e retailers before its consolidated to like 3-4 major ones now who have lot of capital to blow off taking short term losses in order to gain user base.

@blackfire , @AnotherDev GAP & Amazon basic they would classify as products directly sold by GAP or Amazon. My understand of this situation is that this is targeting the B2B side where Amazon, Flipkart are intermediates between the actual seller and consumer. I’ll try to find the actual regulation documents, might be easier to follow than the excerpt linked above.

EDIT: The manged to find the regulation in another article, the website is down. Nice!
There is a cached page available though, added it to the original post. The website defines various models of e commerce, probably 99% of Amazon falls under the Marketplace based model of e-commerce see 5.2.15.2.2 (iv). The point 4 in that section is talks about the equity & also the ownership of inventory.

I guess the different models of e-commerce would require the company to operate differently !? Anyone else make sense of this?