First Draft of Upcoming e-Commerce Policy of India is Designed to ensure Safety of Indian E-Commerce Companies

All e-commerce companies like Flipkart, Alibaba and Amazon might have to store user data exclusively in India in view of security and privacy concerns, according to an initial draft of e-commerce policy. The above-mentioned aspects were discussed at the meeting of a high-level think tank.

The draft recommendations were prepared by several stakeholders, including private sector and government officials from different departments such as commerce, industry, IT and electronics. This think tank included members of government agencies, e-commerce companies such as MakeMyTrip, Reliance Jio, Ola, JustDial, UrbanClap, Bharti Group, PepperFry, etc.

These suggestions were discussed by all the stakeholders of this think tank headed by Commerce Minister Suresh Prabhu. However, the first cut of the draft is clearly looking as it is getting prepared to safegurad the Indian e-commerce companies. The think tank would now work out the final draft national policy framework for e-commerce sector based on these recommendations, which would be placed in public domain for further comments.

Data that would be required to be stored exclusively in India includes "community data collected by IoT (Internet of Things) devices in public space; and data generated by users in India from various sources, including e-commerce platforms, social media, search engines etc", according to the initial draft.

The draft also talks about the government having access to data stored in India for national security and public policy objectives.

A level playing field was suggested for domestic players by ensuring that foreign websites, involved in e-commerce transactions from India also follow domestic rules.

It was suggested that the government should set up a separate wing in the Directorate of Enforcement to handle complaints related to the implementation of guidelines related to foreign direct investment in the e-commerce sector.

Bulk purchase of branded goods, especially mobile phones, which lead to price distortions in the marketplace may be banned, the initial draft stated.

On competition issues, it suggested that the Competition Commission should consider amending the threshold limit to examine potentially competition distorting mergers and acquisitions.

Briefing media about the meeting, OSD Anup Wadhawan, the new commerce secretary, said that the recommendations which were discussed today are very comprehensive in nature and covers each aspect of e-commerce such as data flows, consumer protection, grievance redressal, logistics, and server localization.

"From today's meeting, a set of recommendations has emerged for further necessary action by the government for formulating e-commerce policy for the country," he said.

When asked about the suggestions which came up in the meeting, he said issues such as regulator for the sector, consumer data protection, data localization and competition were discussed.

"Competition laws in terms of fairness in the marketplace, in terms of avoiding predatory pricing. The policy will uphold some underlying competition principles," he said adding several recommendations were discussed on consumer data protection.