1. E-Commerce Regulations
1.1 What are the key e-commerce legal requirements that apply to B2B e-commerce in your jurisdiction (and which do not apply to non-e-commerce business)? Please
include any requirements to register, as well as a summary of legal obligations specific to B2B e-commerce.
In India, there is a great degree of overlap in legislation governing e-commerce and non-e-commerce businesses, such as the requirements for setting up a business, employment laws, and legal metrology legislation.
The legislation applicable to B2B e-commerce that governs foreign investments and the setting up of a business in India by foreign entities and individuals is the prevailing Foreign Direct Investment Policy (FDI Policy) and the Foreign Exchange Management Act, 1999, with the accompanying Rules. The FDI Policy prescribes: the maximum ownership that a foreign individual or foreign entity can have in an Indian entity engaged in certain business activity; the nature of business entity which can
be established; the quantum of investment to be made for setting up or acquiring a business; and various other conditions that an Indian entity with foreign investment should comply with.
100% foreign direct investment is permitted in companies engaged in cash and carry wholesale trading and B2B e-commerce businesses. Such investment can be made without prior approval of the Government of India. Cash and carry wholesale trading, including sales through B2B e-commerce, would mean sale of goods or merchandise to retail, industrial, commercial, institutional or other professional business users, as opposed to end-consumers or retail customers for personal consumption.
The following conditions apply to companies with foreign direct investment engaged in B2B e-commerce:
1. Customers to whom goods can be sold: Sales should be made to retail, industrial, commercial, institutional or other professional business users, namely:
i. entities holding the applicable tax registration;
