Amazon files petition in court against investigation order of Competition Commission

In its petition in the Karnataka High Court, Amazon sought a stay against the probe order by Competition Commission of India citing that it would cause irreparable damage to the company.

Global online retailer, Amazon has filed a case in the Karnataka High Court seeking a stay against the investigation by the Competition Commission of India (CCI) which has ordered a probe into the company for alleged violation of competition laws in the country.

Amazon, in its application with the High Court, stated the investigation order “suffers from non-application of mind as it appears to contain no reference to the finding of an appreciable adverse effect on competition,” according to a report by news agency Reuters.

The ecommerce company which filed its application today stated, “The entire order passed by (the CCI) ... is bereft of any foundation."

This petition comes after the CCI in January had ordered a probe into alleged violations and business malpractices by Amazon and Walmart-owned Flipkart.

According to CCI, both ecommerce companies had promoted and gave discounts to preferred sellers on its platform, also entering into exclusive partnerships with smartphone brands, and in the process, abusing their dominant position.

In the petition, Amazon stated that the investigation by CCI could cause “irreparable” loss and damage to its reputation.

The CCI order came in after an offline merchant group complained that ecommerce giants were promoting select sellers and in turn hurting business for the smaller players.

According to Reuters, the Karnataka High Court is likely to hear the petition of Amazon later this week and the complainant trader group Delhi Vyapar Mahasangh has been informed about it.

Amazon and Flipkart have faced criticism from the offline traders that the steep discounts offered by these ecommerce companies were deeply hurting their business. However, both these companies have strongly denied these accusations and said they were compliant with the law.

The ecommerce sector in India has also come under the spotlight from the government, which had introduced new norms early last year that had necessitated them to work out a new business model to remain compliant with the law.

(Edited by Saheli Sen Gupta)