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Can foreign investment be allowed in an e-commerce start up?


09-Oct-2023 (In Startup Law)

Hi Here is my query. Is foreign investment allowed in an eCommerce startup? If yes, what type of foreign bodies can invest . If no, what types of bodies can invest in an eCommerce startup. Also, can an individual of Indian/foreign origin invest in an Indian startup?

Answers (1)

Answer #1
996 votes
Ecommerce is of two types : B2B (business to business) and B2C (business to consumer). B2B is largely unregulated and foreign investment can freely come in. In B2C however, foreign investment is not permissible. Therefore whether investment can come is depends on your business model. Foreigners will have to follow the above guidelines as well. Till recently NRIs too had to adhere to the same but that position has changed. If investment is made by an NRI on a non repatriation basis, the same can be considered as domestic investment.
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