Draft National e-commerce Policy

Published: June 19, 2019

The Union Minister for Commerce and Industries Piyush Goyal has asked the companies to submit concerns on draft e-commerce policy in 10 days.

Draft Policy: Key Components

  • It proposes setting up of a legal and technological framework for restrictions on cross-border data flow.
  • It lays out conditions for businesses regarding collection or processing of sensitive data locally and storing it abroad.
  • The draft policy suggests for a framework o provide the basis for imposing restrictions on cross-border data flow from specified sources including data collected by IoT devices installed in public space, and data generated by users in India by various sources, including e-commerce platforms, social media, search engines.
  • The policy aims to address six broad issues of the e-commerce ecosystem viz. data, infrastructure development, e-commerce marketplaces, regulatory issues, stimulating domestic digital economy and export promotion through e-commerce.
  • The policy states that data is the new oil. India s data should be used for the country s development and Indian citizens and companies should get the economic benefits from the monetisation of data.
  • The business entity which collects or processes any sensitive data in India and stores it abroad would be required to adhere to the certain conditions and all such data stored abroad shall not be made available to other business entities outside India, for any purpose, even with the customer consent.
  • The data shall also not be made available to a third party for any purpose or with a foreign government without the prior permission of Indian authorities.
  • It entails steps to prevent business models or strategies which are discriminatory and those which favour one or few sellers/traders operating on their platforms over others by online marketplaces.
  • The draft policy calls for all e-commerce sites/apps available for download in India to have a registered business entity in India as the importer on record or as the entity through which all sales in India are transacted.
  • The policy suggests measures to contain the sale of counterfeit products, prohibited items and pirated content.
  • The draft notes that existing statutes and laws are insufficient and they must evolve to take into account the changing ways of doing business and changing business models.
  • The draft policy calls to review the current practice of not imposing customs duties on electronic transmissions in the light of the changing digital economy and the increased role that additive manufacturing is expected to take.
  • The policy calls to incentivise export by reducing administrative requirements for outbound shipments through e-commerce. The policy calls to increase the existing limit of Rs 25,000 to make Indian e-commerce exports attractive even for high-value shipments through courier mode
  • The policy calls to undertake an assessment regarding how data-storage-ready is the available infrastructure in the country. The creation of infrastructure for storage would take some time. Hence a time-frame of three years be given to allow the industry to adjust to the data storage requirement.

The draft policy has been proposed by the Department for promotion of industry and internal trade. The Ministry of Commerce and Industries has asked e-commerce industry representatives to flag their concerns.

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