In the middle of growing steam of antitrust cases against the US ‘BigTech’ companies, Amazon now finds itself in an antitrust case filed at the Competition Commission of India (CCI) by the All India Online Vendors Association. The lawsuit, like several others that Amazon routinely witnesses, alleges that the American e-commerce giant favors certain retailers whose discounts are driving smaller vendors out of business.
2000 online sellers who are part of the All India Online Vendors Association and sell goods on Amazon as well as Walmart-owned Flipkart. The sellers are alleging that Amazon India buys goods in bulk from manufacturers and then sells it at a loss to retailers such as Cloudtail. These retailers then sell these goods at a discounted rate on the e-commerce platform.
In its filing at CCI, the group alleges, “This anti-competitive arrangement … is causing foreclosure of competition by driving independent sellers out of the market”, as seen by Reuters. The lawyer of the sellers’ group, Chanakya Basu, confirmed the case filing at the CCI. Unfortunately, case filing and details of the same at the CCI are not made public.
Amazon had earlier claimed that it treats all its sellers equally and complies with all Indian laws. Regulations in India allow Amazon to run an e-commerce market where sellers can sell their goods for a fee. Amazon’s biggest Indian seller, Cloudtail, pays a fee of 6.3% for electronic goods as compared to the 23.1% for independent sellers, claimed by the independent sellers’ group in their filing. They say this makes it difficult for them to compete on its website.
The smaller sellers say the e-commerce giant uses complex business structures to bypass regulations laid down by the government of India to deter steep discounts. Amazon has denied this allegation. The filing also included screenshots of product listings on the website that showed products to be discounted between 8% to 45% compared to the retail prices on the website.
The CCI in January had ordered investigations into Amazon and Flipkart, under the allegations of violation of competition law and discount practices. According to court filings, Amazon has challenged these allegations.
Amazon boss Jeff Bezos recently appeared before the US Congress for a hearing, where he admitted to counterfeit goods being sold on Amazon.
