While Amazon vs India’s competition regulator CCI (Competition Commission of India) has been a heated battle already, it isn’t over. In fact, it is now being joined by Amazon’s biggest rival in the country, albeit in a manner that could benefit both. According to court filings reviewed by Reuters, Walmart-owned Flipkart has now filed lawsuit challenging CCI’s antitrust probe. The probe was launched by the competition watchdog simultaneously against both Amazon and Flipkart.
CCI had, in January, launched an investigation into alleged antitrust activities by ecommerce companies Amazon and Flipkart. The commission was looking into violations of competition law and certain discounting practices, primarily motivated by a union of a section of India’s offline retailers. However, the Karnataka state high court had put a 8 weeks stay on the proceedings, bringing relief to the commerce companies.
So why did Flipkart file a suit? A source told Reuters that this lawsuit was aimed at signaling the company is ‘aggrieved’ by the CCI’s probe order.
According to the filing which was done on February 18th in a Bengaluru city court, Flipkart argues the CCI ordered its probe without initial evidence that the company’s practices were harming competition. Without mincing words whatsoever, Flipkart said the CCI order was “perverse (and) passed without any application of mind”. The ecommerce giant has asked the court to quash the order.
A similar argument was made by Amazon in open court, where its lawyers suggested that CCI had ordered this probe without any evidence. While the court did not rule entirely in Amazon’s favour, a temporary stay for 2 months does highlight fallacies in the way CCI has approached the entire matter. Political commentators argue that the Government has used the competition commission as a tool to appease small retailers, which form a large base of voters and could sway public opinion significantly.
We have asked for a comment from Flipkart on the same, and shall update the story as and when we receive one.
