Delhi HC issues notice to Centre on PIL alleging illegal operation of Chinese e-commerce website

The Delhi High Court on Tuesday issued a notice to the Centre on public interest litigation (PIL) seeking directions to the Union of India, and Ministry of Commerce to take appropriate steps against Chinese company 'SPPIN India Private Limited', for allegedly running operations of the e-commerce websites--'Shopee'-- in India that may have "grave and imminent" danger to the security, sovereignty, and territorial integrity of India.

The plea stated that the company floated to hoodwink the relevant authorities in order to defeat the mandate of Press Note 3. A direction for blocking the Shoppe app under the provisions of Section 69-A of the IT Act are also sought in the plea.

The division bench of Justice DN Patel and Justice Jyoti Singh on Tuesday issued notice to the Centre and sought its response, before further slating the matter for January 11, 2022.

According to the Petitioner Shashank Shekhar Jha (a practising lawyer), SPPIN India Private Limited ("SPPIN"), a company registered under the Companies Act, 2013, operating e-commerce websites "seller.shopee.in" and "shopee.in" and a mobile application "Shopee: Online Shopping", respectively.

"SPPIN has been conducting its operations in contravention with the Foreign Direct Investment Policy, 2020 and the Foreign Exchange Management Act, 1999 read with Foreign Exchange Management (Non-Debt Investment) Rules, 2019, as amended consequent to the publication of the Press Note 3 (2020 series) dated April 17, 2020, published by the FDI Policy Section, Department for Promotion of Industry and Internal Trade, Ministry of Commerce and Industry, Government of India," the plea said.

The plea stated that the e-commerce operations of the brand Shopee are conducted across the globe by SEA Limited. Tencent entities, a well known Chinese company holds a total of 22.9 per cent of the shares in SEA Limited.

It further stated that, in view of the current regulatory framework, this leads to the obvious conclusion that the mobile application and website under the aegis of the brand Shopee would and is required to seek prior permission of the Government of India in terms of the mandate of Press Note (PN3). As such, it is imperative to ban any such Chinese entity which is misusing the corporate veil to penetrate the Indian economy and its markets in derogation of the letter and spirit of PN3.

The petition alleged that the actions of SPPIN and the inactions of the respondents are likely to have "grave and imminent danger to the security, sovereignty, and territorial integrity of India."

The petition also alleged that the public and private data of the Indian citizens collected by SPPIN is likely to be compromised, given that such data is believed to be stored on a cloud space, which, directly or indirectly, is accessible to the Chinese government.

( With inputs from ANI )

Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor