Amazon and Flipkart Petition Rejected
Recently, the Supreme Court has rejected the petition of Amazon and Flipkart against the Competition Commission of India (CCI) investigation.
- The Supreme Court has refused to interfere with the order of the Karnataka High Court in a case involving Amazon and Flipkart.
- It is to be noted that in this order the Karnataka High Court has declined to stay the investigation initiated by the Competition Commission of India (CCI) against Amazon and Flipkart for alleged anti-competitive practices.
- The investigation was initiated by the CCI following a complaint made by the Micro, Small and Medium Enterprises (MSME) group. It was mentioned in the complaint that both Amazon and Flipkart are adopting preferential treatment towards certain sellers having indirect stake in them.
- Flipkart and Amazon, through vertical agreements with their preferred sellers, have provided unethical access to aggressive pricing, preferential treatment and exorbitant discounts. This has forced other merchants to foreclosure from the online marketplace.
Exorbitant discount – This includes offering a higher or more discounted price than usual. For example, offering huge discounts for online sales of certain cell phones.
Aggressive/Cheap Pricing – In this, an attempt is made to illegally eliminate competition by drastically reducing prices. Thereafter, prices are increased to compensate for the loss in the presence of fewer competitors.
To address this problem, a draft e-commerce policy has been prepared by the government. The policy aims to ensure that e-commerce entities do not set up digital monopolies. Also, ensure equal treatment to all vendors or vendors registered on your platform.
About the CCI
- Competition Commission of India (CCI) is a statutory body established under the Competition Act 2002.
- The commission’s duty is to eliminate practices having an adverse effect on competition, promote and sustain competition, protect the interests of consumers and ensure freedom of trade in the Indian markets.
Source – The Hindu
