New E-commerce Restrictions Will Impede Amazon's Growth in India
Effective February 1, 2019, the Indian government will be banning e-commerce companies from selling products where they have an equity interest. This will be especially harsh on Amazon and Flipkart (owned by Wal-Mart). In a statement earlier, the commerce ministry said:
"An entity having equity participation by e-commerce marketplace entity or its group companies, or having control on its inventory by e-commerce marketplace entity or its group companies, will not be permitted to sell its products on the platform run by such marketplace entity."
In addition to company ownership, the new rules state that “E-commerce entities providing marketplace will not directly or indirectly influence the sale price of goods or services and shall maintain level playing field…” Wal-Mart and Amazon are both scrambling to try and get the effective date pushed back.