The alleged circumventing of foreign direct investment (FDI) regulations by e-commerce firm Flipkart Online Services and retail giant Bharti Walmart will now be probed by the Enforcement Directorate (ED).
Commerce & Industry Minister Anand Sharma said on Monday that the Reserve Bank of India (RBI) referred matters related to the alleged violation of FDI regulations by Flipkart and Walmart to the (ED).
Informing the Lok Sabha about the development in the cases, Mr. Sharma said, "Matters related to Bharti WalMart/Cedar Support Services Ltd and M/s Flipkart Online Services Pvt. Ltd, respectively, have been referred to the Directorate of Enforcement for further investigation."
He added that circumventing of FDI regulations was covered by the penal provisions of the Foreign Exchange Management Act (FEMA), 1999.
Flipkart has flouted rules that allow e-commerce firms with foreign investments to conduct business-to-business transactions but not business to consumer transactions.
US retailer Walmart has come under the scanner for allegedly investing $100 million front-end retailer Bharti Retail's holding company when foreign companies were not allowed to make investments in Indian retail sector. Meanwhile, WalMart is also carrying out an internal investigation into allegations that its officials bribed officials in Indian, China and Mexico to accelerate the process of opening of stores.
- Marathon Pharma to sell decades-old drug to treat DMD for $89,000
- FedEx Launches FedEx Fulfillment for Small Business to Compete with Amazon
- CDC updates 2017 advisory for recommended flu shots
- Coca-Cola Helped by Strong North American Demand but Company Issues Lackluster Future Guidance
- Women with dense breasts more likely to develop breast cancer: study