Four sources familiar with the talks said that Amazon.com Inc. and India’s Tata Group had warned government officials Saturday about their plans to make tougher rules for online sellers.
Many executives raised concerns about the proposed rules at a meeting organized by the consumer affairs ministry as well as Invest India’s investment promotion arm. They asked for an extension of the deadline to submit comments on July 6, according to sources.
The new, tougher e-commerce rules that the government announced June 21 to strengthen consumer protection caused concern among country’s online retailers, especially market leaders Amazon (NASDAQ;AMZN) Inc’s Flipkart.
The new rules, which include a ban on flash sales and prohibiting misleading advertisements, will force Flipkart and Amazon to review their business structures. This could also increase the costs of domestic competitors like BigBasket, JioMart and Snapdeal.
Amazon claimed that COVID-19 has already affected small businesses, and that the proposed rules will have a significant impact on sellers. They also claimed that certain clauses are already covered under existing law, according to two sources.
Because the discussions were confidential, the sources requested not to be identified.
According to the proposed policy, e-commerce companies must ensure that no related businesses are listed on their websites as sellers. Amazon could be affected by this, especially as it has an indirect stake of at least two of its sellers: Cloudtail and Appario.
Barkha Jain is founder of TechVerbal. She is a techy nerd who loves to write about technology, new gadgets and crypto. She loves to travel and watch movies in her free time.