Cabinet clarifies on Multi Brand Retail:
1) sourcing restriction among 'group companies', and requirement of 50 per cent investment in back-end within three years of first FDI tranche are still being considered by the government.
2) Entire investment in back-end infrastructure has to be an additionality".
Further, the companies would also not be allowed to supply the back-end services to franchisees run by its partners.
3)The retailers, however, will be able to set up such infrastructure in even in the states, which have not allowed the multi-brand retail in their jurisdiction.
4)Foreign retailers would not be allowed to indulge in wholesale trade (business-to-business) or run operations through franchisees. The multi-brand retail trading (MBRT) store set up will have to be 'company owned and company operated'.
5)MBR front end stores to be opened, wholesale trading cannot be treated as backend infra.
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