Foreign Company Registration a must for foreign E-commerce sites in India

Top Quote Foreign e-commerce sites have to get their business entity registered as per the e-commerce policy draft. End Quote
  • (1888PressRelease) March 01, 2019 - E-commerce sites, especially foreign business entities in India which has made the lives of people simpler and accessible with a single touch now has to mandatorily get their business entity registered in India.

    This registration needs to be done as per the latest draft e-commerce policy which also proposes regulation of cross-border flow of data collected by sector players in India.

    This is mainly proposed due to the entry of certain top Chinese e commerce players like AliExpress, Shein, Romwe, and complaints made against them to the Government by traders` bodies like All India Online Vendor Association about Chinese online operators shipping cheaper products to Indian customers as gifts in order to avoid customs duty.

    Checkpoints of the draft e-commerce policy for all foreign e commerce sites are:
    • Have the foreign company registered in India
    • The registration can be done either as an importer or an entity with all sales are transacted in India
    • There is a ban on all the items parceled as gifts, baring life saving drugs
    • The data collected by the e-tailers in India and stored abroad cannot be shared with other business entities
    • Government has all the liberty to access this data stored abroad anytime
    • Restrictions on cross-border flows of data would not apply to data which is not collected in India.

    However companies involved in technology related data flows like Software and cloud computing does not have to follow the above said regulations.

    E-tailers are also restricted from selling products of companies in which they have stakes as per the new norms laid down by the Foreign Direct Investment (FDI). In par with the FDI norms Amazon has been compelled to remove its products from the India website.

    Amazon and Walmart, the major e-commerce players of United States having recently acquired a 77 per cent majority stake in the Indian e-retail major Flipkart, are reviewing the draft e-commerce policy and will share their inputs on the proposals in course of time.

    The Indian Government through the e-commerce policy draft has made the foreign company registration mandatory and this is majorly to avoid any discrepancies in conducting businesses in India by foreign business entities.

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