BackGovt says plea against e-commerce websites not relevant after new FDI rules
Footwear association told it will have to change its plea against e-commerce websites in view of new FDI regulations
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New Delhi: The Union government on Thursday told the Delhi high court that it had issued a statement clarifying that 100% foreign direct investment (FDI) was allowed in online retail of goods and services under the so-called “marketplace model" through the automatic route.
In the light of this, the petition filed by the All India Footwear Manufacturers and Retailers Association became infructuous, additional solicitor general Sanjay Jain said.
On 29 March, the government issued a press note, allowing 100% FDI for online retailers following a marketplace model and restricted them from offering more than 25% discount from one vendor.
“Earlier your contention was that FDI was not permitted. Now they’ve clarified that it’s allowed. This (press note) meets your grievance fully," justice Rajiv Sahai Endlaw told the Footwear Association.
“If you have to challenge, you have to challenge this press note," he added.
Jain argued that the Footwear Association ought to file an affidavit detailing what grievances remained in the light of the press note.
The Footwear Association, while acknowledging that the government notification levelled the playing field for e-commerce websites and physical retailers, argued that there was no compliance with the same and that violation of the FDI norms continued.
The association, however, conceded that it might have to change the directions it sought from the court. The association will revert with its grievances with the press note.
The case will be heard next on 23 May.
The high court, in this case, had directed the government to probe 21 e-commerce websites for alleged violation of FDI norms.
Justice Endlaw on Thursday observed that the Enforcement Directorate would not be able to continue its probe after the government’s clarification on the same. No order has been passed in this regard at this stage.
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