In February, the Karnataka HC stayed the CCI’s probe into allegations of deep discounting and preferential treatment to sellers

Icons of Flipkart and Amazon India next to each other
Atom Anti-trust Wednesday, October 07, 2020 - 18:03

The Competition Commission of India filed an appeal with the Supreme Court against the Karnataka High Court’s February decision to stay a probe by the antitrust body into Flipkart and Amazon into their alleged anti-competitive practices. Reports stated that the CCI filed a Special Leave Petition in September with the court.

In February, the Karnataka High Court stayed the CCI’s probe under Section 3 of the Competition Act, which was put in motion after a complaint by the Delhi Vyapar Mahasangh over deep discounting and preferential treatment to sellers. The Delhi Vyapar Mahasangh alleged that the two e-commerce majors were violating sections of the Competition Act of 2002 and said that the two companies have several tie-ups with private labels which get more preference in terms of sales, especially in the smartphone category.

Both the e-commerce players then approached the Karnataka HC, asking for the probe to be stayed.

The parties were given two months’ time to respond and has put a stay on CCI’s probe until then, but there has been no update since.

The Confederation of All India Traders called the CCI’s move “logical” and said that it was awaited. CAIT is impleaded in the plea, and it supported the CCI’s position in court.

“The appeal by CCI is one of the most logical and most awaited steps to nail both Amazon and Flipkart for continuing their respective mal-practices including predatory pricing, deep discounting (and) exclusive arrangements with brands and holding inventory,” Praveen Khandelwal, the association’s general secretary alleged.

He added that the court will take cognisance of the plea, but that the government should introduce an e-commerce policy which has a regulatory authority.

This move comes as both Flipkart and Amazon India are gearing up for huge sales for the festival season.

Furthermore, in March, the National Company Law Appellate Tribunal (NCLAT) directed the CCI to investigate Flipkart based on a complaint of the All India Online Vendors Association (AIOVA) over allegations that they abused their dominant position.

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