The Confederation of All India Traders (CAIT) has welcomed the order of Competition Commission of India (CCI) to levy ₹200 crore penalty on Amazon and suspend an Amazon-Future deal the regulator had approved in 2019 after stating that Amazon had deliberately suppressed the actual scope and purpose of the combination.
Amazon.com NV Investment Holdings LLC (Amazon), a direct subsidiary of Amazon.com Inc, had acquired 49% shareholding in Future Coupons Private Limited (FCPL), which in turn holds 9.82% of the shareholding in Future Retail Limited (FRL). Citing its indirect shareholding in FRL, Amazon had opposed the stake sale of FRL by its promoters to Reliance Industries. CCI said that Amazon had not disclosed its interest in FRL while seeking approval for its investment in FCPL. The competition watchdog has asked Amazon to pay the penalty within 60 days.
“Amazon failed to notify FRL share holder agreement (SHA) and the commercial arrangements, as parts of the combination between the parties, and suppressed the actual purpose and particulars of the combination, as discussed above, in contravention of the obligation contained in sub-section (2) of Section 6 of the Act read with Regulation 5 and sub-regulations (4) and (5) of Regulation 9 of the Combination Regulations,” CCI Order issued on December 17, said.
“Amazon stands fully exposed for its malpractices, and bunch of lies at all levels together with continued violation of laws and the rules. The CAIT has demanded union commerce minister Piyush Goyal to order for immediate suspension of Amazon portal in India,” said CAIT secretary general Praveen Khandelwal.
CAIT had filed a public interest petition in the Delhi high court seeking expeditious disposal of Amazon-FCPL case by the CCI. The traders’ groups has been up against foreign e-commerce entities for a long time.
CAIT said that the CCI verdict should be seen as a signal to not only Amazon but other foreign funded e-commerce companies too to “stop violating the law, rules and foreign direct investment (FDI) policy of the Government”.