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New Indian E-Commerce Rules to Affect Zomato, Swiggy, Ola, Uber and MakeMyTrip

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At least four industry sources told ET that the government's proposed changes to the e-commerce sector will affect a wide variety of online companies selling goods and services.

According to them, the suggestions from the Department of Consumer Affairs will affect online travel company MakeMyTrip, food delivery companies Zomato and Swiggy, ride-hailing companies Ola and Uber, and home services company Urban Company.

Sources told ET that these companies are currently assessing the impact of the draught India e-commerce standards, which extend beyond large marketplaces like Amazon India and Flipkart.

Some of these companies are expected to participate in conversations organized by business organizations such as FICCI, CII, and IndiaTech starting on Friday.

The modifications, which are extensive. Since Monday, they've been kicking up a storm.

The expansion of the foundations to platforms beyond sub-sectors of online commerce has prompted more concern from industry players. The main gripe is that online platforms that provide services claim to have been lumped in with platforms that sell goods.

“This has been an issue for a while, and they (services firms) have informed the government that we should not be lumped in with platforms that sell things since our businesses are so distinct. There is a debate continuing among companies in ride-hailing, food delivery, travel, and others, and we would submit recommendations after finalising everyone's relevant issues”, another individual familiar with the ongoing conversations said.

They've also raised concerns about a number of proposals, including the
A general ban on flash gross sales, the sale of house options during the pre-purchase stage, and a fallback liability are all on the table.

“Flash discounts are crucial for the travel business, and it’s been happening for a long time where airlines provide a number of seats at low costs. Even suggestions like offering local alternatives, how would it work? Do we show an Indian airline whenever someone tries to book a flight on a foreign airline that might be less expensive than the Indian option? “A person who is aware of the discussions stated.

The department stated in its note that when selling imported goods or services, e-tailers should offer alternatives that are accessible locally at the pre-purchase stage to give domestic goods producers a fair chance.

This comes after the government forced e-tailers to display the country of origin on all products displayed on their platforms last year, however this was mostly limited to online marketplaces. After a long period of borde, the development began.

China is the source of many things, including cellphones and appliances sold online.

“This has been an issue for a while, and they (services firms) have informed the government that we should not be lumped in with platforms that sell things since our businesses are so distinct. There is a debate continuing among companies in ride-hailing, food delivery, travel, and others, and we would submit recommendations after finalising everyone's relevant issues”, another individual familiar with the ongoing conversations said.

Although e-commerce companies oppose this condition, executives say that because of the interruptions caused by the Covid-19 epidemic, it has become more difficult for platforms that offer services like travel to accept liability.

The Centre's explanation, according to ET on June 23, allowing e-commerce portals to hold traditional sale events while prohibiting only specific flash sales or back-to-back offers, had exacerbated misunderstanding among e-tailers, brands, and sellers. Flash sales will not be permitted, according to the government regulation, since they restrict customer choice, raise prices, and create an unequal playing field.

Industry sources, on the other hand, called the government statement vague.

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