India top court refuses to stall probe against Amazon, Flipkart

THE Supreme Court of India on Monday (9) decided against halting an inquiry into the business practices of e-commerce firms Amazon and Walmart-owned Flipkart, rejecting their appeal to pause a probe by the Competition Commission of India (CCI).

Last year, the regulator ordered the investigation over allegations of promotion of select sellers on the e-commerce platforms and using business practices that stifle competition. The inquiry is also focussed on accusations that the two companies are bypassing India’s laws by creating complex business structures.

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The probe triggered public disputes between the two firms and the Indian government as both of them denied any wrongdoing and mounted several legal challenges. According to them, the CCI did not comply with internal criteria for minimum proof before ordering its probe and it has not highlighted any agreement that flouts existing laws.

The three-member branch of the Supreme Court headed by Chief Justice NV Ramana was not convinced with the companies’ arguments and said both the e-commerce platforms should “volunteer for” such investigations.

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“We expect organisations like Amazon and Flipkart... big organisations... they have to volunteer for inquiry and transparency. We expect that... and you don't even want (an) inquiry,” Ramana said, adding, “You have to submit and inquiry has to be conducted.”

The two companies have been given four weeks to join the probe against them.

Amazon and Flipkart, both of which have American ownerships, moved the top court after the high court of the South Indian state of Karnataka dismissed pleas to quash the CCI investigation in July.

The companies faced a setback when the court said that since they denied all allegations, they should not feel shy in facing the probe.

(With Reuters inputs)