The US based e-commerce giant, Walmart Inc., which last year had purchased 77 percent stakes of India’s e-commerce service provider Flipkart and Amazon.com, had been found hurrying on to reforming ownership structures and reworking on some critical vendor relationships, as the company seeks to comply with new Indian e-commerce policy without disordering its business structure, set to be aired on February 1st.
Later on December, 2018, the Indian government modified several e-commerce rules around the foreign direct investment, overhauling additional hurdles for the retail giants to avert a concrete monopolization of the business, as it had been experienced with China’s Alibaba.
The new rule, which would be kicking off from tomorrow, February 1st, would not allow any e-commerce site either to practice ownership, or to take control over the inventories of a seller, as the new legislation barred any company to sell products through an e-commerce platform, in which they held stake.
Apart from that, the new rules had also buckled down the supremacy of e-commerce provider to seal any hidden deal with a particular vendor. Rivals and traders had been quoted saying that many foreign e-commerce companies in India like Walmart owned Flipkart and Amazon had been violating the essence of those rules by creating proxy sellers as well as vendors, who had been doing business on behalf of them, leaving the small-entrepreneurs dried out.