Draft e-commerce policy out soon, aims to control cross-border data flow

The policy also lays strategies to address issues pertinent to the sector including consumer protection, data privacy and maintenance of a level-playing field

The draft national e-commerce policy, to be released by the government soon, is aimed at creating a framework for achieving holistic growth of the sector along with the existing policies of Make in India and Digital India.

"The draft policy will be released any time soon," an official said.

"In light of the increasing importance of data protection and privacy, the National e-Commerce Policy aims to regulate cross-border data flow, while enabling sharing of anonymised community data (data collected by IoT devices installed in public spaces like traffic signals or automated entry gates)," the draft, accessed by PTI, said.

It said conditions are required to be adhered to by business entities which have an access to Indian users' sensitive data stored abroad.

"Sharing of such data with third-party entities, even with customer consent, is barred under the policy. Violation of conditions of this Policy will be made accountable to prescribed consequences (as formulated by the Government of India)," it added.

However, certain categories of data are exempted from restrictions on cross-border data flow. Data not collected in India, B2B data shared between business entities under a commercial contract, data flows through software and cloud computing services (having no personal or community implications), data (excluding data generated by users in India from sources like e-commerce platforms, social media activities, search engines) shared internally by multinational companies are exempted from restrictions on cross-border data flows.

The policy lays strategies to address issues pertinent to the sector including consumer protection, data privacy and maintenance of a level-playing field.

"The policy takes into account interests of all stakeholders, be they investors, manufacturers, MSMEs, traders, retailers, start-ups and consumers, according to the draft.It said the strategies envisages should provide a basis for unlocking productivity, generating new-age jobs, protecting critical personal information, enhancing consumer awareness and facilitating onboarding of domestic producers, manufacturers, traders and retailers.

It also said that the e-commerce sector is driven by technology and data, and continuously evolving technologies and volumes of data generated in a consumer-oriented country like India require an enabling regulatory framework for empowering domestic entrepreneurs, leveraging access to data, connecting MSMEs, vendors, traders, etc. to the digital ecosystem as well as empowering consumers to retain control of the data generated and owned by them.

It added that currently, a handful of companies dominate the digital economy and they are successfully exploiting the significant first mover's advantage in the data-driven ecosystem.

"Once a certain scale is reached, it becomes virtually impossible for the 'second mover', on its own, to make an entry in this ecosystem," it added.