New Delhi: India’s antitrust body has ordered an investigation into alleged competition law violations by Amazon.com Inc and Walmart’s Flipkart, it said in an order on Monday. The investigation order comes in a week when Amazon chief Jeff Bezos is expected to visit India for a company event and potential meetings with government officials.
The Competition Commission of India (CCI) said that exclusive arrangements between mobile phone brands and e-commerce platforms, as well as allegations of e-commerce companies giving preferential treatment to certain sellers “merits an investigation”.
The investigation is the latest setback for Amazon and Walmart’s Flipkart, which Indian brick-and-mortar traders allege violate the country’s foreign investment rules.
Both the companies deny those allegations.
CCI has asked the Director General to investigate the alleged predatory practices of Amazon and Flipkart after being approached by the Delhi Vyapar Mahasangh, a group representing small- and medium-sized businesses, which alleged that several of Amazon and Flipkart’s preferred sellers were affiliated with or controlled by the companies themselves, either directly or indirectly. The DG has 60 days to submit the report.
The CCI also wants its investigations arm to probe the e-commerce companies’ discounting practices as well as their relationship with such sellers, it said in its 11-page order.
The investigation is the latest setback for Amazon and Walmart’s Flipkart, which Indian brick-and-mortar traders allege violate the country’s foreign investment rules and burn billions of dollars to offer steep discounts that hurt smaller traders.
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