Amazon faces antitrust case in India

Amazon India is again facing the heat as more than 2,000 online sellers have filed an antitrust case with the antitrust watchdog – Competition Commission of India (CCI) against Amazon India, over allegations of anti-competitive practices by the e-commerce giant.

The online sellers have alleged that Amazon Wholesale India Pvt. Ltd (AWIPL) purchases goods in bulk from manufacturers and sells them to sellers such as Cloudtail at a loss, which are then listed on Amazon.in at deep discounts. Some independent sellers are impacted as Amazon India favoured some other sellers by giving deep discounts.

It has been alleged that Amazon gave preferential treatment to its own entities like Cloudtail thereby restricting independent sellers from competing. Allegedly, deep discounts are facilitated through its own sellers on their marketplace as well as private labels, according to people familiar with the matter.

AWIPL operates a B2B marketplace (amazondistribution.in) where 350,000 small and medium offline sellers buy different categories of products for resale to customers or for institutional consumption.

In January, the CCI had announced that it would investigate the two largest e-commerce firms—Amazon and Walmart-owned Flipkart—following allegations by CAIT – a trader body that Amazon India was engaged in anti-competitive practices in the smartphone category.

In the latest instance, the All India Online Vendors Association, which sells products on e-commerce platforms, alleged that Amazon engages in unfair business practices.

“This anti-competitive arrangement ... is causing foreclosure of competition by driving independent sellers out of the market,” said a filing with the CCI.

According to Amazon spokesperson, sellers on Amazon.in have the absolute discretion to decide what products to sell and their prices and that Amazon is compliant to all relevant laws of the land and operates the marketplace with high degree of transparency and uniformity.