e-Commerce law in India forces Amazon and Flipkart to pull out 400,000 products.
The new e-Commerce law in India came into action in the country today. The new regulations imposes a ban on exclusive sales, prevents retailers from selling on platforms they count as investors, and it applies restrictions on discounts and cash back promotions.
This is a huge problem for both Amazon and Flipkart. Amazon, on 2016, restricted its system so that its own products were offered by entities that it jointly owned. This was done after a rule on 2016 prohibited companies from owning inventories. However, the latest restrictions prevent companies to work with organisations that they own. Amazon may have pulled as many as 400,000 products from sale in India.
In order to comply with the rule, Flipkart may also have pulled a quarter of their total products.
Flipkart and Amazon have been unsuccessful to get a three month extension to the rules. Some reports suggest that the companies are still trying to push the Feb 1 deadline.