The draft rules published on June 28 aim to tighten regulations on online marketplaces. The Consumer Affairs Department had given until July 21 for various stakeholders to submit their comments.

The Australian government, which is negotiating a trade pact with India – including a dedicated chapter in the e-commerce deal – has formally written to the Consumer Department stressing that the new rules “would impose extensive extraterritorial obligations on e- foreigners. business entities operating in India ”.

“We consider that the proposed changes would be too prescriptive and increase trade barriers, especially for SMEs,” he wrote in an undated communication titled “Consultation on proposed changes to consumer protection rules (e-commerce ), 2020 from the Government of India ”made to the Ministry of Consumer, Food and Public Distribution.

A copy of this submission and contributions submitted by other stakeholders for the draft e-commerce rules have been obtained by The Indian Express under the authority of the Right to Information Act.

Specifically, among the seven concerns he raised were aspects such as the definition of predatory selling, the mandatory registration of e-commerce companies with the Indian government, and the time limitation for remedying complaints. In addition, amid concerns reported by Indian government departments and industry players, Australia has also requested clarification on the flash sales ban.

“We support efforts to implement rules prohibiting fraudulent online business practices. However, we note that the organization of flash sales by e-commerce entities is common and a widely accepted international practice. In this regard, we would like some clarification on how the fraudulent interception might be determined in practice and what “technological means” might encompass, ”he noted.

The Indian Express reported on Friday that the draft rules had received scathing comments from several government departments, including the Department for the Promotion of Industry and Internal Trade, the Niti Aayog, the Ministry of Commercial Affairs, the Ministry of Finance and the Ministry of Electronics and Information. Technology. These ministries reported several anomalies, questioned certain provisions and suggested adjustments to the proposed rules.

“In summary, the e-commerce rules, as drafted, are likely to have a significant negative impact on Australian e-commerce entities operating in India. The rules would impose unreasonable compliance costs and be particularly onerous for SMEs, which would likely have implications for competition and consumer choice in India, ”the Australian government wrote.

Email queries sent to the Australian High Commission in New Delhi on Friday did not elicit a response.

Australian Trade, Tourism and Investment Minister Dan Tehan, who is visiting India, told a press conference on Friday that he had discussed e-commerce with his Indian counterpart and that the two parties had agreed that there would be a chapter on electronic commerce. in the final chord. The two countries have already agreed to reach an interim or early trade deal by Christmas and a final free trade agreement or comprehensive economic cooperation agreement (ECSC) by the end of 2022.

India and Australia plan to exchange offers on the draft ECSC agreement by October. Australia has said it wants to access Indian e-commerce channels for its high-end food, drink and consumer products businesses.

In addition to the Australian government, trade bodies and groups representing American companies such as the US-India Business Council and the US-India Strategic Partnership Forum have also raised several concerns about the proposed e-commerce rules in separate written letters. July 21. These relate to clauses such as country of origin, abusive sales, registration of e-commerce entities, back-up liability and the appointment of staff already mandated under the new IT rules.

“These appointments not only unduly add to the compliance burden on e-commerce entities, but there is no distinction between the roles and responsibilities of the various appointees… in addition, the obligation of the RGO (Resident Grievance Officer) by an electronic commerce entity the similar obligation applicable to an intermediary under the Information Technology Act of 2000, ”noted the Strategic Partnership Forum between the United States and India in its contributions.

US companies Amazon and Walmart-owned Flipkart have a majority stake in India’s e-commerce pie. Large domestic retail players such as Reliance Industries and the Tata Group also intend to enter the segment.

Notably, in December 2020, the US Congressional Research Service, a bipartisan public policy research institute, reported concerns about “barriers to investment” in India despite the goal of attracting foreign investment. “US concerns about barriers to investment persist nonetheless, exacerbated by new Indian restrictions on how e-commerce platforms such as Amazon and Walmart-owned Flipkart operate. From the US perspective, India’s poor regulatory transparency and other issues, such as IPR and localization policies, add to concerns about barriers to FDI, ”he noted.