With reference to foreign-owned e-commerce firms operating in India, which of the following statements is/are correct? 1. They can sell their own goods in addition to offering their platforms as market-places. 2. The degree to which they can own big sellers on their platforms is limited. Select the correct answer using the code given below:
- A1 only
- B2 onlyCorrect
- CBoth 1 and 2
- DNeither 1 nor 2
Explanation
Statement 1 is incorrect. Under India's FDI policy, foreign-owned e-commerce entities operating under the marketplace model are not permitted to sell goods owned by them directly to consumers. They can only provide a platform for third-party sellers.
Statement 2 is correct. FDI policy restricts the equity that a foreign e-commerce entity or its group companies can hold in seller entities on their platform, to prevent them from influencing pricing and inventory.
Therefore, only statement 2 is correct.
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