Lok Sabha Question No. 2254 (UNSTARRED), answered on 2018-01-01
Subject: Violation of FDI Rules by e-Commerce Companies
Ministry: COMMERCE AND INDUSTRY
Asked by: P. C. MOHAN

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT OF INDUSTRIAL POLICY & PROMOTION

## LOK SABHA

UNSTARRED QUESTION NO. 2254. TO BE ANSWERED ON MONDAY, THE 1 ST  JANUARY,  2018.

## VIOLATION OF FDI RULES BY e-COMMERCE COMPANIES

## 2254.   SHRI P.C. MOHAN:

Will the Minister of COMMERCE AND INDUSTRY be pleased to state:

वाणिज्य

## एवं उद्योग मंत्री

- (a) whether the Government has noticed that e-commerce companies in the country have violated the Foreign Direct Investment (FDI) rules;
- (b) if  so,  whether  the  Enforcement  Directorate  has  registered  complaints  before  the Ministry in this regard;
- (c) if so, the details thereof and the action taken so far by the Government in this regard;
- (d) whether the Government has received complaints from the people against e-commerce companies; and
- (e) if so, the details thereof and the action taken by the Government in this regard?

## ANSWER

## वाणिज् यएवंउद्योग मंत्रालयमेंराज् यमंत्री(श्री सी.आर.चौधरी) THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE & INDUSTRY

## (SHRI C.R. CHAUDHARY)

- (a): The Foreign Direct Investment (FDI) policy is notified across various sectors, including  e-commerce,  under  Foreign  Exchange  Management  Act  (FEMA), 1999 and any violation of FDI regulations is covered by the penal provisions of  the  FEMA,  1999.  Reserve  Bank  of  India  administers  the  FEMA  and Directorate of Enforcement under the Ministry of Finance is the authority for the  enforcement  of  FEMA.  Thus,  violations,  if  any,  are  to  be  dealt  with  by Enforcement Directorate and Reserve Bank of India.
- (b): No  such  complaints  have  been  sent  by  Enforcement  Directorate  to  this Ministry.
- (c): Question does not arise.
- (d) & (e): National  Consumer  Helpline  (NCH)  has  been  set  up  by  the  Department  of Consumer Affairs to receive complaints from consumers. E-commerce sector contributed around 18% of the total complaints/ dockets registered at NCH in

the  current  year  2017-18.  The  details  of  complaints  received  at  NCH  in e-commerce sector are tabulated below:

| Sector -E-commerce    | Sector -E-commerce        |
|-----------------------|---------------------------|
| Year                  | Docket/ Calls Registered* |
| May 2014-March 2015   | 16919 (calls)             |
| April 2015-March 2016 | 28331 (calls)             |
| April 2016- Mar 2017  | 54872 (calls / Docket )   |
| April 2017-Nov 2017   | 54114 (Docket)            |

*   Data includes repeat calls and enquires.

## Redressal Mechanism (Action Taken)

NCH had partnered with some companies to resolve their customer complaints received  at  NCH.  This  is  the  alternate  grievance  redressal  method,  and  is  a completely voluntary initia t ive taken up by these companies. As part of this 'Convergence'  programme,  NCH  forwards/gives  access  to  the  individual Convergence  Company  to address/redress these complaints as per the Company's own internal grievance handling system. The redressal provided is communicated  to  the  customer  as  well  as  to  NCH  by  the  company.  From August  2016,  the  portal  www.consumerhelpline.gov.  in    has  also  been developed  to  provide  a  platform  to  consumers  to  register  their  complaints. Companies  which  have  voluntarily  partnered  with  NCH  as  part  of  the 'Convergence' programme, directly respond to these complaints according to their redressal process and revert by providing a feedback to the complainant on the portal directly.  Complaints regarding those companies which have not partnered  with  National  Consumer  Helpline  are  forwarded  by  NCH  to  the company for redressal.

As on date, 58 e-commerce companies are enrolled with NCH as convergence partners.

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