FDI in E-commerce – Marketplace Model

The Department of Industrial Policy & Promotion has vide a press note dated 29th March 2016 (the “Press Note”) allowed 100% FDI under automatic route in online retail of goods and services with certain key conditions. The Press Note lays down certain key conditions while allowing 100% FDI in an e-commerce entity engaged in the Marketplace model.

This may force the online market players either refusing certain products or depending on sale forecast pulling off certain products from display – whether this may arise competition law issue is something which time may tell.

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