Navigating Global FDI Policy in E-Commerce: Strategic Structuring for Success
Foreign Direct Investment (FDI) is a crucial component in the growth and expansion of e-commerce businesses across the globe. However, the regulatory landscape can be complex, with different jurisdictions imposing varying restrictions and conditions on how FDI can be utilized. For e-commerce platforms looking to attract foreign investment, understanding and leveraging the right business structures is essential. Key Business Models in E-Commerce 1. Marketplace Platforms: Marketplace e-commerce platforms are designed to facilitate transactions between buyers and sellers without owning the inventory themselves. This model is particularly attractive in markets that allow 100% FDI under the automatic route, as it offers flexibility and minimizes regulatory hurdles. Companies operating under this model can focus on providing a seamless platform experience while allowing a diverse range of sellers to connect with buyers. 2. Technology Platforms: Investing in tec...