Startups seek changes in listing requirements
What's the news?
A clutch of India’s most richly-valued consumer internet companies will soon petition the country’s market regulator for a revision in rules that govern the listing of startups on Indian stock exchanges, according to industry executives aware of the plans.
The companies, which include ANI Technologies that owns and operates ride-hailing app Ola, eyewear solutions company Lenskart and online insurance policy aggregator PolicyBazaar, want Sebi to either remove the requirement of promoters holding at least a 20% stake in the companies that they have founded, or consider it on a case-by-case basis.
Why does this matter?
For startup founders whose holdings in their companies typically range between the high single digits or in the low-to-mid-teens, the Sebi stricture to maintain a 20% stake in order to list on Indian bourses is proving restrictive.
For example, the founders of Lenskart, Ola and PolicyBazaar have stakes ranging between 4% and 15% in their respective ventures, following dilution in their holdings after multiple rounds of funding.
Company executives argue that Sebi’s suggestion that promoters make up for the shortfall from their respective investors when their own stakes fall short of the 20% requirement, is also not a viable option. Read more.
CCI keeping a close watch on ecomm discounts
What's the news?
India’s competition regulator is closely watching the issue of deep discounting by ecommerce players as it gears up to deal with possible anti-competitive behaviour in the sector. Ecommerce platforms, such as Amazon and Flipkart, are getting ready to launch big sales in the upcoming festival period, and traders’ bodies have opposed the move to offer consumers significant discounts on products during the sale period.
Why is this important?
Deep discounts could make some businesses unviable as it erodes the value of products and services in the mind of the consumer if done for extended periods, Ashok Kumar Gupta, chairperson of the Competition Commission of India (CCI), told ET. He said that CCI would look to file more cases on its own, as it adopts a more proactive approach to tackle market distortions.
The CCI will, however, balance the interest of both online platforms and small businesses, Gupta said. Read more.
Relief for H1B visa holders
What's the news?
The proposal by the Donald Trump administration to ban spouses of H-1B visa holders from working in the United States may not be implemented until next year, offering temporary relief to thousands of Indian nationals as well as the technology companies employing them.
US Department of Justice told an American court that it has set a time frame of Spring 2020 — or between March and June next year — to bring in rules to revoke the H-4 employment authorisation document.
What's the significance?
Indian nationals, the majority of them qualified women, have been the primary beneficiaries of the H-4 EAD, receiving over 90% of the 120,000 visas issued since 2015.
In September 2017, the Trump administration first suspended the work visa programme for spouses of H-1B permit holders. This is a part of Trump’s ‘Buy American, Hire American’ push, which has also resulted in a higher rate of H-1B denials in recent years. Trump will contest for a second term next year. Read more.
Concerns over EC's social media code
What's the news?
Social media companies, including big ones such as Google, Facebook, and ByteDance, have raised concerns about how to proceed with the Election Commission of India's 'voluntary' rules on misinformation and political advertising on social media, during the upcoming state government elections.
ET reported earlier this month that the EC wants social media to replicate the Code adopted for the general elections during the upcoming state polls.
What are the concerns?
The Code finalised for the general elections in March empowered EC officials to send takedown notices on content deemed misinformation, and political advertisement, during the mandatory 48-hour silent period before voting begins.
Last week, social media companies had expressed concern over state-level election commission officers sending takedown notices. They said that too many takedown notices from multiple officials could cause confusion, as against the centralised process that was followed during the general elections.
Companies are also worried that EC might extend these rules to local polls such as municipal and panchayat elections, according to sources privy to the matter. Read more.
Why businesses are opting for Telegram
What's the news?
Over the last few months, Telegram has become the destination of choice for businesses to onboard and retain customers. While a few years back, the secure messaging app was used mostly by the tech-savvy, more businesses and people are joining the platform today, and for multiple reasons.
Why are they moving to Telegram?
The privacy protections offered by Telegram is one of the key advantages. Customer details remain private and secret chats can be automatically deleted. Cloud storage is also another advantage since users can share files without compression. Read more.