India probe finds Amazon, Walmart's Flipkart breached antitrust laws
Repeats Sept 12 story with no change in text
India says Amazon, Flipkart broke local competition laws
Companies had select sellers which hurt smaller players, reports find
Amazon, Flipkart have previously denied charges
By Aditya Kalra
NEW DELHI, Sept 12 (Reuters) -An Indian antitrust investigation has found U.S. e-commerce giant Amazon AMZN.O and Walmart's WMT.N Flipkart violated local competition laws by giving preference to select sellers on their shopping websites, according to reports seen by Reuters.
The Competition Commission of India (CCI) in 2020 ordered an investigation into Amazon and Flipkart for allegedly promoting certain sellers with which they had business arrangements and giving priority to certain listings.
In a 1027-page report on Amazon and a separate 1,696-page report on Flipkart, both dated Aug. 9, the CCI investigators said the two companies were found to have created an ecosystem where preferred sellers appeared higher in search results, elbowing out other sellers.
"Each of the anti-competitive practices alleged ... were investigated and found to be true," said both reports, which are not public and are being reported by Reuters for the first time.
"Ordinary sellers remained as mere database entries," the two reports said in identical conclusions on both companies.
Amazon and Flipkart, as well as the CCI, did not immediately respond to Reuters queries. They have previously denied wrongdoing and said their practices are in line with Indian laws.
The two companies will now review the report and file any objections before CCI staff decide on any potential fines.
The investigation's findings are the latest setback for Amazon and Flipkart in a country where they continue to face criticism for their business practices from smaller retailers, who say their businesses have suffered in recent years due to deep discounts offered online.
The investigation was triggered by a complaint from the Delhi Vyapar Mahasangh, which is an affiliate of the country's biggest trade body, Confederation of All India Traders (CAIT), that represents 80 million retailers.
In a statement to Reuters, CAIT welcomed the CCI investigation findings, saying it would study the reports and "escalate the matter" with the federal government.
Amazon and Flipkart are leading players in India's e-retail market which was estimated to be worth $57-60 billion in 2023, and set to top $160 billion in value by 2028, consultancy firm Bain estimates.
In the United States, the Federal Trade Commission has sued Amazon alleging the company uses "anticompetitive and unfair strategies to illegally maintain its monopoly power". Amazon has said that the FTC lawsuit is wrongheaded and would hurt consumers by leading to higher prices and slower deliveries.
PREFERENTIAL LISTING, DEEP DISCOUNTING
Indian investigators raided certain sellers of Amazon and Flipkart during the probe, following a Reuters investigation in 2021 which was based on Amazon internal documents and showed the company gave preferential treatment for years to a small group of sellers on its platform, and used them to bypass Indian laws.
The company has denied any wrongdoing but the CCI previously told an Indian court the Reuters special report corroborated evidence it had against Amazon.
The CCI investigation report on Amazon said preferred sellers on the platform "get the advantage in the (online) listing" and when a customer searches for any product, "his attention is drawn towards" those listings.
The practice of preferential listings and deep discounting of mobile phones - including selling products below cost price - causes a "catastrophic impact on the existing competition in the market."
In the report on Flipkart, the CCI said preferred sellers were provided various services such as marketing and delivery at a "miniscule cost." They were also enabled by Flipkart to sell phones with deep discounts which amounts to "predatory pricing" and forecloses competition, the CCI said.
"The anti-competitive practies are not limited to sales of mobile phones. They are equally prevalent in other categories of goods," both reports said.
Flipkart and Amazon for months tried to block the investigation through legal challenges in courts, but the Supreme Court in 2021 allowed it to go ahead.
Last month, India's commerce minister publicly called out Amazon by saying the company's investments were often used to cover its business losses.
Amazon in June last year said it will increase its Indian investment to $26 billion by 2030, including for its cloud business. It is also targeting merchandise exports worth $20 billion from India by 2025.
Reporting by Aditya Kalra; Additional reporting by Aditi Shah, editing by Deepa Babington
Mga Kaugnay na Asset
Pinakabagong Balita
Disclaimer: Ang mga kabilang sa XM Group ay nagbibigay lang ng serbisyo sa pagpapatupad at pag-access sa aming Online Trading Facility, kung saan pinapahintulutan nito ang pagtingin at/o paggamit sa nilalaman na makikita sa website o sa pamamagitan nito, at walang layuning palitan o palawigin ito, at hindi din ito papalitan o papalawigin. Ang naturang pag-access at paggamit ay palaging alinsunod sa: (i) Mga Tuntunin at Kundisyon; (ii) Mga Babala sa Risk; at (iii) Kabuuang Disclaimer. Kaya naman ang naturang nilalaman ay ituturing na pangkalahatang impormasyon lamang. Mangyaring isaalang-alang na ang mga nilalaman ng aming Online Trading Facility ay hindi paglikom, o alok, para magsagawa ng anumang transaksyon sa mga pinansyal na market. Ang pag-trade sa alinmang pinansyal na market ay nagtataglay ng mataas na lebel ng risk sa iyong kapital.
Lahat ng materyales na nakalathala sa aming Online Trading Facility ay nakalaan para sa layuning edukasyonal/pang-impormasyon lamang at hindi naglalaman – at hindi dapat ituring bilang naglalaman – ng payo at rekomendasyon na pangpinansyal, tungkol sa buwis sa pag-i-invest, o pang-trade, o tala ng aming presyo sa pag-trade, o alok para sa, o paglikom ng, transaksyon sa alinmang pinansyal na instrument o hindi ginustong pinansyal na promosyon.
Sa anumang nilalaman na galing sa ikatlong partido, pati na ang mga nilalaman na inihanda ng XM, ang mga naturang opinyon, balita, pananaliksik, pag-analisa, presyo, ibang impormasyon o link sa ibang mga site na makikita sa website na ito ay ibibigay tulad ng nandoon, bilang pangkalahatang komentaryo sa market at hindi ito nagtataglay ng payo sa pag-i-invest. Kung ang alinmang nilalaman nito ay itinuring bilang pananaliksik sa pag-i-invest, kailangan mong isaalang-alang at tanggapin na hindi ito inilaan at inihanda alinsunod sa mga legal na pangangailangan na idinisenyo para maisulong ang pagsasarili ng pananaliksik sa pag-i-invest, at dahil dito ituturing ito na komunikasyon sa marketing sa ilalim ng mga kaugnay na batas at regulasyon. Mangyaring siguruhin na nabasa at naintindihan mo ang aming Notipikasyon sa Hindi Independyenteng Pananaliksik sa Pag-i-invest at Babala sa Risk na may kinalaman sa impormasyong nakalagay sa itaas, na maa-access dito.
