The Bharti School of Public Policy (BIPP), Indian School of Business (ISB), organized a full-day closed-door roundtable at the Hyderabad campus on 6th May which brought together participants from government, seller associations, industry members, law firms, think tanks and academia to deliberate on e-commerce policy. This closed-door session in an academic setting allowed for open discussion on the various challenges along with counterparts from the industry helping in better clarification of those aspects.
The experts also deliberated on
- GST compliances and taxation creating hurdles for small sellers to onboard on to online.
- Contribution of e-commerce to opening up of larger market for the sellers.
- The role of big e-commerce market place and their role in creating an eco-system for the small sellers to grow on the problems.
- The sellers should be equally responsible for their activities and not just marketplace.
- Festive sales and how it is helping sellers.
- The need to compartmentalize private brands and their marketing on the marketplace
Experts highlighted the need for in-depth empirical research and surveys on the seller ecosystem in India along with documentation of the challenges faced and the impact of e-commerce platforms on these sellers. As an outcome of this, BIPP and ISB proposed to come up with two reports consisting of an analysis of these policy aspects along with policy recommendations for consideration by the Ministry of Commerce, Government of India. The first report would capture recommendations for data ownership, norms for displaying search results on e-commerce platforms, along with transparency measures that would help users make informed decisions on the business relations between the sellers and the marketplace platforms. The second report would investigate the aspects of taxation laws in e-commerce and provide policy recommendations for simplification and parity to enable both sellers and marketplace platforms. These come after the first report of this series on policy norms for Foreign Direct Investments (FDI) in e-commerce which was released in November 2021, and the second one on policy recommendations for business models which is due for release soon.
In the modern world, data is seen as the largest harbinger of profits and innovation. Humongous volumes of data are generated on e-commerce platforms including user demographic, location, and payment details. Data on a user’s search and browsing on e-commerce platforms are all captured and stored including products viewed, amount of time spent by users on each product page, activities like product comparison, etc. Finally, data on the products added to the shopping cart, purchase, return, and customer feedback are also captured on the platform.
There are no clear policies on aspects related to the ownership and monetization of the data generated on e-commerce platforms – several draft policies by various government bodies like the Department of Industrial Promotion and Policy (DPIIT), Consumer Affairs, Ministry of Electronics and Information Technology (MEITY) and Competition Commission of India (CCI) suggests norms on dealing with this data along with insights, search and advertisements from these accumulated data. As the entire landscape of the digital economy is evolving, such policies fail to capture the interests of all the involved parties – users, small sellers, or the e-commerce marketplaces. Further, there is a misalignment in the taxation laws for similar products sold online vs. offline which creates challenges for certain trader communities.