Since the new e-commerce rules have come into force in India on Feb 1, the sales of Flipkart and Amazon fell by as much as 30 percent. The new regulations prohibit e-commerce companies from holding any stakes in companies that sell on their platform.
Also for companies whose overall sale volumes cross the 25% mark on a marketplace shall be barred from continuing to sell on them. To comply with the new government regulations, the two captive sellers on Amazon – Cloudtail, and Appario will only be accepting B2B transactions going forward.
Walmart-owned Flipkart, on the other hand, continues to offer platform-exclusive products like earlier and hasn’t taken them down. On the other hand, electronic products from some leading companies are unavailable on Amazon.
At Amazon, the legal teams are still working towards finalizing a structure that is fully compliant with the new rules.
Cloudtail and Appario ownership structure-
-Prione Business Services owns 100 percent of Cloudtail, which is 49-51 joint-venture between Amazon and Catamaran India
-Appario is a 49-51 joint-venture between Amazon and Patni Group
Source: Economic Times
