Amazon Export Sales LLC debuts as seller in India
Amazon group company Amazon Export Sales LLC has debuted as a seller on its India site in several categories such as fashion, lifestyle and electronics among others with the recently launched Global Store.
Amazon India denied that this violated foreign direct investment (FDI) norms as the unit was registered overseas and all transactions would be concluded outside the country, according to an Economic Times report.
Online sellers and brick and mortar retailers have expressed their apprehensions about the move. But the Seattle-based company said that it was in compliance with the law.
“Amazon.in enables sellers (domestic and international) to list their products for Indian customers. Amazon Exports Sales LLC is also a listed seller on Amazon India. Amazon Exports Sales LLC is an exporter of products and therefore the mention of custom duties in their listings. Amazon has a high bar for compliance with laws of the land and Amazon.in is in compliance with all applicable laws,” an Amazon India spokesperson said.
The rules stipulate that e-commerce companies with overseas investment should function as technology marketplaces that connect buyers and sellers. This means firms can’t sell anything directly themselves, and also need to maintain a level playing field for all sellers and cannot influence pricing directly or indirectly.
The All India Online Vendors’ Association (AIOVA), a group of 1,000 online sellers, said that when a seller is owned by the marketplace or is a group company, pricing is bound to be influenced.
“Is the seller owned by Amazon paying charges such as commission, advertising and promotional charges at the same rate as others?” asked an AIOVA spokesperson.
Dismissing AIOVA’s charges, the Amazon spokesperson said the company is committed to creating level playing field to encourage healthy competition. “We have different types of sellers on our marketplace... Each group of sellers is treated with parity.”
The Retailers’ Association of India (RAI), a brick and mortar grouping, called for clarity. “As we understand, an e-commerce marketplace is not allowed to influence pricing. In this case when a seller is owned by Amazon, then how is it not flouting the norms? There is clarity required... and we would like government agencies to look into it,” said RAI CEO, Kumar Rajagopalan.
The Global Store sells products not available in India, Amazon India’s spokesperson said.
“The Global Store type of functionality simply allows a listing service in India for foreign sellers though the underlying transaction is no different.”
However, some products on the Global Store listed under Amazon Export Sales are also sold by Indian sellers, including Cloudtail, which is part owned by Amazon, but at different prices.
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