He also claimed that by creating name lending companies, Amazon and Flipkart had bought branded goods in a huge amount at discounted rates from manufacturers and leaving no path for sellers to sell its products neither in e-commerce market not in nearby areas.
In December 2018 government amended FDI norms and gave time till 1st February 2019 to execute operation of firms according to new norms. According to India’s new foreign direct investment policies:-
- Cashback system should be fair and crystal clear to the buyer and seller.
- E-commerce marketplace is prohibited to show ownership or control over entities.
- E-commerce companies can do a transaction with sellers only on a business to business basis.
- Retailers are not allowed to put a mandatory situation to any seller to sell any product exclusively on its platform.
In order to cope up with new FDI policies, Amazon India has closed selling products sold under its own private labels and also closed selling by firms in which it owned stacks including Cloudtail and Appario.
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