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CAIT filed a complaint with the department of industrial policy and promotion alleging violation of FDI norms for e-commerce by Flipkart. Photo: Hemant Mishra/Mint
CAIT filed a complaint with the department of industrial policy and promotion alleging violation of FDI norms for e-commerce by Flipkart. Photo: Hemant Mishra/Mint

CAIT alleges Flipkart violated e-commerce FDI norms

The complaint is in reference to an advertisement in the newspapers announcing the sale of an item together with its discounted price to be available on Flipkart

New Delhi: Traders’ body the Confederation of All-India Traders (CAIT) on Wednesday filed a complaint with the department of industrial policy and promotion (DIPP) alleging violation of foreign direct investment (FDI) norms for e-commerce by online retail major Flipkart.

The complaint is in reference to an advertisement in the newspapers announcing the sale of an item together with its discounted price to be available on the e-commerce platform of Flipkart, which is said to be a marketplace.

The said advertisement violates conditions of the guidelines for FDI in e-commerce spelled out in press note No.2 (2016 Series) issued by DIPP on 29 March, 2016.

“We invoke your attention to the provision of the said press note which said “e-commerce entities providing marketplace will not directly or indirectly influence the sale prices of goods or services and shall maintain level playing field," the CAIT said in a letter to the DIPP secretary.

However, immediate response could not be obtained on a mail sent to Flipkart regarding the allegations by CAIT.

CAIT said the advertisement “clearly contravenes the above provision in as much as it is inviting the consumers to register themselves for purchase at a discounted price at marketplace of Flipkart and this act directly or indirectly influences the sale price of goods and also creates an uneven level playing field".

The traders’ body urged DIPP secretary to take cognisance of the advertisement and demanded suitable action against the erring entities.

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