CAIT alleged that Amazon suppliers, Cloudtail and Appario together control 80% of business on Amazon marketplace, which is a mockery of the law.

Narayana Murthy in suit
Money News Friday, February 19, 2021 - 19:32

The Confederation of All India Traders (CAIT) has demanded an investigation into the role of Amazon supplier, Cloudtail India owned by N R Narayana Murthy and has written to Commerce Minister Piyush Goyal in this regard. CAIT, in a letter to Goyal, has sought a point-wise investigation including mockery of the law by Cloudtail India Limited and Appario Retail (P) Limited, joint ventures with Amazon India Limited. 

"In this context, we reiterate that not only Amazon, its joint ventures in India too are hand in glove and knowingly helping it desecrating our country's rule of law. It is also deeply worrying that some banks are colluding with Amazon by helping it keep prices lower than the market through exclusive policies giving cashback," CAIT alleged. 

"We draw your kind attention towards Cloudtail India (P) Limited, a company owned by Sh Narayan Murthy, Appario Retail (P) Limited, owned by Mr. Ashok Patni, Darshita EtelDarshita Mobiles, STPL-Green Mobiles and Rocket Kommerce", CAIT said. 

It added that these together control 80% of business on Amazon marketplace. Though according to law and policies, the marketplace (Amazon) should not have relation or control over the retailer (eg Cloudtail), these retail companies are fully controlled by Amazon. Thus, Amazon's "marketplace" narrative is a mere myth, CAIT said. 

"In Cloudtail and its holding company, Prione Business Services, it is no coincidence that the managing directors, CFOs, key persons are (so-called) former employees of Amazon. Even the majority of board members of Cloudtail are (so-called) former employees of Amazon. No surprises that Sh Murthy owns 76 per cent in Cloudtail (and Prione owns 100 per cent of Cloudtail) yet the board of directors have Amazon in majority. To reiterate, Cloudtail and Prione are managed and operated by Amazon via (so-called) former employees", CAIT said. 

In Cloudtail and its holding company, Prione Business Services, MD, CFOs, senior employees are all (so-called) former employees of Amazon.

"The above structure lays bare the brazenness and intent of Amazon. Even though Murthy holds the majority of shares, he has allowed the (so-called) former employees of Amazon on the driver's seat of both Cloudtail and Prione. This points to complicity of Murthy and possible financial contributions by Amazon, making Murthy and each of the named individuals wilful "partners in crime." The role of Murthy requires appropriate investigation," CAIT said. 

"We draw your kind attention towards various schemes of the different banks for giving 10% discount/cash back on a regular basis from time to time for purchase of any product from the portal of e-commerce companies Amazon & Flipkart. The banks include, HDFC Bank, State Bank of India, ICICI Bank, Citi Bank, Kotak Mahindra Bank, HSBC, Bank of Baroda, RBL Bank, Axis Bank," CAIT said. 

CAIT said the above are providing these cash discounts only on purchase of goods from ecommerce by making payment through their Debit/Credit Cards but if the same goods are purchased from Brick & Mortar shops of crores of our members, this discount is not provided. “Providing cash back exclusively to online shoppers through Amazon & Flipkart assumes the status of a cartel which leads to helping them indulge into malpractices like predatory pricing, exclusivity and creation of an uneven level playing field in the market,” it alleged. 

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