TMI BlogCLARIFICATION ON QUERIES OF PROSPECTIVE INVESTORS/ STAKEHOLDERS ON FDI POLICY FOR MULTI-BRAND RETAIL TRADINGX X X X Extracts X X X X X X X X Extracts X X X X ..... onal retail trading operations? (a) No. The 30% sourcing will be reckoned only with reference to the front end store. As such a multi-brand retailing entity cannot engage in any other form of distribution. (b) Whether a small industry referred to the actual legal entity of manufactured/processed products purchased with investment within USD 1 million which shall not include its parent company, subsidiaries, affiliates and/or franchisor? Whether farmer, cooperative, agro-business including dairy, poultry and fresh, distributor and reseller of major branded companies will be counted as a SME if its investment is within USD 1 million? (b) The phrase used in the FDI policy is 'small industries' with maxim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is concerned FDI in non-FDI approved States in back-end infrastructure will be counted provided it is an additionality. (d) Will the new retail entity include back-end facilities that have the capacity to supply its own businesses and other businesses. It should be free to supply back-end services (e.g. logistic supply, goods) to related or third party companies, including but not limited to the company s existing wholesale entity and the retail franchisee operated by its partners. (d) As per the conditions for wholesale cash carry trading, such an entity is not permitted to undertake retailing of any form. Therefore, both the businesses have to be kept separate through different entities. As regards supplies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k end infrastructure. (b) Can back-end and front-end infrastructure be held by separate entities? Can the back-end entity be 100% owned by a foreign entity since 100% FDI is permitted under the automatic route for a company engaged in back-end infrastructure related? (b) The back-end entity may be 100% owned by a foreign entity as long as the investor in MBRT has been able to satisfy the condition that 50% of the FDI brought into the country for MBRT has been utilized in back-end infrastructure as an additionality. Small industry certification: Suppliers should have some form of authentication to confirm their status as small industry . Certificate issued by District Industries Centre w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bject to the applicable State/Union Territory laws/ regulations. The State Governments have the prerogative of imposing additional conditions accordingly. (c) In case, the foreign investor approaches a State Government not included in the list of states supporting FDI in MBRT, would the approval of such new state be valid before they are notified to the DIPP for addition in the list? (c) If the foreign investor approaches a State Government not included in the list of states supporting FDI in MBRT, consent from the State Government would be sufficient, and a suitable amendment to the policy will be issued by the Central Government. Policy on E-commerce Allowing online sales ..... X X X X Extracts X X X X X X X X Extracts X X X X
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