Legal Challenges to Amazon and Flipkart Antitrust Investigation

By Aditya Kalra

NEW DELHI (Reuters) – India's antitrust body has asked the Supreme Court to hear legal challenges to an investigation of Amazon (NASDAQ:AMZN) and Walmart (NYSE:WMT)'s Flipkart e-commerce platforms. The challenges were filed by Samsung (KS:005930), Vivo, and others at Indian high courts, allegedly aiming to disrupt the probe.

In a filing on Dec. 3, reviewed by Reuters but not released publicly, the Competition Commission of India (CCI) requested the court to hear 23 challenges from Samsung, Vivo, and various vendors on Amazon and Flipkart. This is to facilitate a swift resolution to the case.

Amazon declined to comment, and neither Flipkart, Samsung, Vivo, nor the competition commission responded to requests for comments.

The investigation poses a significant regulatory challenge for Amazon and Flipkart in a market expected to see e-commerce sales exceeding $160 billion by 2028, growing from $57 billion to $60 billion in 2023.

The CCI's investigation unit concluded in August that Amazon and Flipkart violated India's antitrust laws by favoring certain sellers on their platforms. It found that smartphone companies like Samsung and Vivo also broke these laws by colluding with the e-commerce giants to launch products exclusively online.

Following the findings, nearly two dozen lawsuits were filed in five Indian high courts by some vendors, alongside Samsung and Vivo, to halt the investigation, claiming it is aimed at "debilitating and scuttling" the process.

The lawsuits, if upheld, could "lead to absurdity since it will interfere with the flexibility of the (commission's) Director General to carry out investigations in any matter," the commission stated.

For years, Amazon and Flipkart have been criticized by smaller retailers who claim they suffer from the companies' deep discounts and preferential treatment.

Both Amazon and Flipkart deny any wrongdoing. A 2021 Reuters investigation based on internal documents revealed that Amazon provided preferential treatment to a limited group of sellers, using them to navigate Indian laws.

This ongoing CCI investigation began in 2020 but has faced numerous delays.

Most of the 23 recent lawsuits challenge the commission’s investigative process, alleging it failed to follow due procedure.

A lawyer familiar with the proceedings indicated that the commission's request for the 23 cases to be transferred to the Supreme Court is likely to be heard this week.