New e-commerce policy may allow only third party items on e-marketplaces

The Department for Promotion of Industry and Internal Trade (DPIIT) has informed the Parliamentary Standing Committee on Commerce that the conflict of interest that arises because of control of vendors’ inventory by e-marketplace entities would be addressed in the upcoming e-commerce policy. Under the new policy, there will be a clear distinction between the marketplace model and the inventory-based model.

The proposed policy seeks to ensure that e-commerce marketplaces sell only third-party products on their platform.

In an inventory model, an e-commerce company owns the goods or services and sells them directly to consumers; in a marketplace model, the e-commerce