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Goaltide Daily Current Affairs 2021

Dec 28, 2021

Current Affair 1:
Centre notifies the Consumer Protection (Direct Selling) Rules, 2021.

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Central Government in exercise of the powers conferred by clause (zg) of sub-section (2) of section 101 read with section 94 of the Consumer Protection Act, 2019 has notified  the Consumer Protection (Direct Selling) Rules, 2021.

These Rules shall apply to all goods and services bought or sold through direct selling, all models of direct selling, all direct selling entities offering goods and services to consumers in India, all forms of unfair trade practices across all models of direct selling and also to also to a direct selling entity which is not established in India, but offers goods or services to consumers in India.

Existing direct selling entities need to comply of these rules within ninety days from the date of publication of these rules in the Official Gazette.

The direct sellers as well as the direct selling entities using e-commerce platforms for sale shall comply with the requirements of the Consumer Protection (e-Commerce) Rules, 2020.

Direct selling entity and direct sellers are prohibited from:

  1. Promoting a Pyramid Scheme or enroll any person to such scheme or participate in such arrangement in any manner whatsoever in the garb of doing direct selling business;
  2. Participate in money circulation scheme in the garb of doing direct selling business.
  3. Rules provide for Monitoring by State Government.–– For ensuring compliance of these rules by direct selling entity and direct sellers, every State Government to set up a mechanism to monitor or supervise the activities of direct sellers and direct selling entity.

Current Affair 2:
Centre declares Soya Meal as an Essential Commodity

 

In a bid to cool down the domestic prices of Soya Meal, Government has notified an Order under the Essential Commodities Act to declare ‘Soya Meal’ as an Essential Commodities up to 30th June, 2022 by amending the Schedule of the Essential Commodities Act, 1955. Government of India has issued a landmark Order where it has mentioned that in the Essential Commodities Act, 1955, in the Schedule, after serial No. (8), the following item shall be added, “(9) Soya Meal”.

The decision would empower the Union Government and all States/UTs to regulate production, distribution etc. of Soya Meal and to smoothen the sale and availability of this item in the market. It will stop unfair market practices and enhance the availability for consumers like Poultry farm and Cattle feed manufacturers.

Current Affair 3:
SEBI banned Futures trading in 7 commodities for 1 year to curb inflation

 

What is a Future Contract?

Suppose I am a trader and the present ONION prices are ruling at Rs. 20/kg. Now, if because of my experience of the market, I feel that in future the onion prices will go up then rather than purchasing the onions right now and selling it latter, I sign a contract with a farmer/trader that I will purchase 1 Tonne of onions after 30 days (lets say on 23rd Jan 2022). So, I got a signed paper (future contract) and I paid farmer the price @Rs. 20/kg X 1 Tonne. = Rs. 20,000  (Rs. 20K)

After 15 days from now, if the prices of onions started increasing in the physical market and people think that prices of onion will further increase in future then I can sell this paper (future contract) to another trader at a higher price than Rs. 20K. This is because whoever will be holding this paper (future contract) can get the 1 Tonne onions from the farmer on 23rd Jan 2022.

So, the price of the future contract will depend on the demand and supply situation of the agri commodities in the physical market. And sometimes the price of the future contract also influences the price of the commodities in the physical market. Sometimes traders in the physical market uses the future contract price as the reference price for doing trade. So, both impact each other.

Govt. sometimes feel that, allowing the trade of these papers (future contracts) leads to speculation in prices and banning the future trade may cool down prices. That is the reason Ministry of Finance directed SEBI to ban the future (contract) trading in 7 commodities viz. Chana, mustard, paddy, wheat, moong, Soybean and crude palm oil.

Future and forward contracts are similar, the only difference is futures are traded on exchanges while forward contracts are done between two people/entities (called over the counter).

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