Ecommerce firms have come into India and “very blatantly” flouted Indian laws in “more ways than one”, Union commerce and industry minister Piyush Goyal has said and also accused them of arrogance. Piyush Goyal said all e-commerce companies should follow Indian rules and not use muscle or money power to hurt Indian interests.
“The Indian market is big and we welcome all players to come and participate. But clearly, we have to have them working within the rules and laws of the country. Unfortunately, many of these large e-commerce companies have come into India and very blatantly flouted the laws of the land, in more ways than one,” Piyush Goyal said on Saturday, according to PTI.
“I have had several engagements with these large companies, particularly the American ones, I can see a little bit of arrogance of their being big and their ability to finance large amounts of money in the initial stages to try and capture the Indian market or larger part of the Indian market particularly certain products to the detriment of our mom and pop stores,” he added.
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However, Goyal did not directly name Amazon.com or Flipkart, the two large e-commerce players in India, or specify the laws that he said had been flouted.
Goyal said that it was “very” unfair that just because they are large and have large pools of low-cost capital, they should be allowed to get away with hurting domestic interests or domestic consumer interests. “So, I think it will be good that all companies follow the law of the land and do not use muscle power or money power to try and hurt Indian interests,” he said.
Piyush Goyal also talked about the government’s recent draft rules for e-commerce companies or marketplace models applicable to all entities including Indian. The minister said these rules are to protect consumer interest.
The minister also brought up the issue of “predatory pricing” and said these e-commerce firms are trying to “influence market behaviour, their algorithms are trying to influence consumer choice”, which he pointed out are not permitted in India.
“…and when questions about it keep fobbing off, they keep delaying giving the information and when people complain to CCI (Competition Commission of India), they immediately start forum shopping in the law courts of India. If these companies have nothing to hide and if they are doing honest business practices, why do they not respond to CCI?” he asked.
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After a judge dismissed Flipkart and Amazon original pleas earlier in June, the companies have appealed against CCI’s bid to restart an investigation into their business practices.
He also said that several countries like the US are working on anti-trust laws for e-commerce and the UK’s competition and market authority has opened investigations into big tech mainly US forms, “now clearly the world is waking up to the realities of these large tech and big e-commerce companies”.
On Sunday, the Confederation of All India Traders (CAIT) said it has written to Prime Minister Narendra Modi urging the government not to dilute the draft of e-commerce rules under any pressure. CAIT also alleged that unethical and law violating business practices of foreign-funded e-commerce companies has forced the closure of a large number of shops in the country.
“In the wake of expected pressure tactics of foreign funded e-commerce companies against the draft of e-commerce rules…(we urged) him (prime minister) to ensure that no dilution is made in draft of e-commerce rules under any pressure,” CAIT said in a statement.
(With PTI inputs)