Several key ministries, including finance, corporate affairs and the Niti Aayog, have opposed the consumer ministry’s draft e-commerce rules.
The divergences between departments could force the Department of Consumers to reconsider the rules, potentially delaying a decision and perpetuating uncertainty for the sector, which Grant Thornton estimates from $ 64 billion in 2020 to $ 188 billion by 2025 -Dollars will grow.
The Treasury Department has raised concerns that the regulations could adversely affect the sector, which is also a major source of employment. However, the ministry’s concerns must not be considered as part of the consultation process, as feedback came after the latest deadline, a source privy to the deliberations said.
The Department of Corporate Affairs said the rules shouldn’t interfere with competition issues, the source said.
The Treasury Department wants regulations not to restrict the fast-growing sector that has attracted large investments.
The draft regulation submitted by the Ministry of Consumers had proposed regulating flash sales with high discounts and requiring e-commerce companies to register with DPIIT, while stationary stores were excluded. The rules had also suggested making e-commerce companies liable in the event of a seller failure, along with changes to certain definitions compared to certain existing FDI guidelines.
ALSO READ TECH NEWSLETTER OF THE DAY
Today we introduce you to the contenders for two more important categories – Best on Campus and Comeback Kid.
The NITI Aayog has said that the rules are not in the area of consumer protection.
Previously, in its response to the proposed 2020 amendments to consumer protection (e-commerce) regulations, the think tank had indicated that issues related to competition, law enforcement, intermediary liability and data protection do not fall within the remit of the Department of Consumer Affairs and should be addressed by the respective department Ministries are dealt with, which have the competence to handle these complex issues and the nuances.
“While the government wants to protect the kirana stores, it cannot be done by tampering with other laws in the name of consumer protection,” a senior government official told ET.
However, the Ministry of Consumer Affairs denied that there was a dispute between the interest group ministries.
“Internal discussions between various stakeholders, including government agencies, are a sign of a mature and healthy decision-making process. There is nothing wrong or sensational about someone having a different opinion, ”said the official spokesman. “We want to have the best possible set of rules for both consumers and businesses,” added the spokesman.
According to the Ministry of Consumers, the draft e-commerce rules have been opened for public consultation precisely in order to make them more robust, and based on the input received, they will be finalized in due course.
Industry associations are calling for major changes in the drafting of the e-commerce rules