Internal Trade Division
Inter-ministerial Committee on Direct Selling/MLM
2. In the absence of any separate guidelines/ business strategies, all Direct Selling/ Multi Level Marketing business come under the purview of the Price Chits Money Circulation Scheme (B) Act administered by D/o Financial Services. However as it is a banning Act there is no provision under the Act to differentiate genuine direct selling business from banned pyramid/money circulation schemes and this had resulted in alleged harassment/ criminal action against the industry.
To resolve the problem, the D/o Financial Services had considered the possibility of introducing guidelines as part of the ongoing amendment to PCMCS(B) Act. They however have come to the conclusion that any such new provision in the PCMCS(B) Act will only add to the confusion and therefore the D/o Consumer Affairs on its own may examine the need for a separate legislation for the sector. Based on the above decision, an Inter-Ministerial Committee under the chairmanship of Secretary (CA) was constituted on 12th Nov, 2014.
So far the committee has held four meetings and matter is under examination. The Committee’s term has been extended up to 18th May, 2016.
3. The concept of e-commerce will cover purchase or sale of goods or services conducted over computer networks, using multiple formats and devices, including the web and electronic data interchange, using personal computers, laptop, tablets and mobile phones of varying levels of sophistication. E-commerce may involve physical goods as well as intangible (digital) products and services that can be delivered digitally.
Currently there is no single set of law/regulations to govern e-commerce sector. Therefore, just like any other business, these transactions are also covered by a chain of business regulation which include the Companies Act, 1956, Indian Competition Act, Income Tax Act, 1961/Central Excise Act/Central Sales Tax Act, Indian Penal Code, Information Technology Act, 2000, Cyber Security Laws, Foreign Exchange Regulation Act(FERA), FDI policy and Consumer Protection Act, 1986.
There is no proposal for specific law/regulations for e-Commerce industry. However,keeping in view the increased number of online fraud/cheating casesand intheinterest of the consumer, sufficient provisions has been made in the Consumer Protection Bill, 2015, which has since been introduced in the Lok Sabha on 10.8.2015.