Documents, data from Amazon, Flipkart sellers seized in CCI raids

Indian investigators seized data and documents from top sellers on Amazon.com Incs and Flipkart’s marketplaces in another day of raids on Friday due to suspected violations of competition law, sources with direct knowledge told Reuters.

India’s Competition Commission (CCI) started early Thursday attacking two leading domestic sellers on Amazon’s platform – Cloudtail and Appario – as well as some sellers on Walmart’s Flipkart, after allegations that sellers and marketplaces had broken competition laws.

The raids relate to a study commissioned by CCI in January 2020, in which Amazon and Flipkart face accusations of promoting favorite sellers on their websites and prioritizing lists of some sellers, Reuters reported.

On Friday, CCI investigators were collecting emails, documents and data from computers after questioning several officials from the sales companies, two of the sources said.

CCI officers “are gathering relevant evidence for the investigation,” said the first source, who added that data from cell phones – such as WhatsApp chats – was also seized.

The watchdog does not disclose details of its raids.

CCI, Amazon and Flipkart did not respond to a request for comment. Cloudtail and Appario, where Amazon has an indirect stock stake, did not respond either.

The raids follow a Reuters investigation last year, which was based on Amazon’s internal documents and showed that the company for years gave preferential treatment to a small group of sellers on its platform, including Cloudtail, and used them to circumvent Indian laws. (https://reut.rs/3rTWXxi)

It showed that Amazon for years helped these sellers with reduced fees, among other benefits. Amazon has denied any wrongdoing. CCI told an Indian court last year that the Reuters report confirmed evidence it had against Amazon.

Another source of direct knowledge said CCI officers were trying to find details of top sellers operating on Amazon and Flipkart for the period 2016-2020.

The second and third sources said CCI officers on Thursday asked Cloudtail’s CEO to come to the office in the city of Bengaluru while it was being attacked, and answer questions.

Indian retailers, key supporters of Prime Minister Narendra Modi, have long argued that Amazon and Flipkart’s platforms benefit a few big sellers who get special benefits. The companies say they comply with all Indian laws.

Also read: CCI attacks Amazon, Flipkart sales offices; CAIT welcomes the initiative

Leave a Reply

Your email address will not be published.