NEW DELHI: Walmart-owned Flipkart has joined Amazon in challenging an antitrust probe ordered against it over allegations of predatory pricing and preferred treatment to certain sellers. Both the companies made each other respondents in their respective petition filed in the Karnataka High Court against the investigation ordered by Competition Commission of India (CCI).
In January, the antitrust regulator ordered a probe into the practices of the two e-commerce giants, stating that discounting practices, exclusive tie-ups, private labels are anti-competitive. The probe was ordered after a Delhi-based trader group complained that the online retailers were promoting select sellers, hurting business for other smaller players.
In its writ petition, Flipkart Internet Pvt Ltd termed the CCI’s actions as an “open-ended fishing expedition” and a misuse of its powers. Refuting allegations, it further said that the probe order of CCI deserves to be set aside as “the impugned order makes it evident that the CCI has proceeded on the basis of mere speculation” and has failed to appreciate that such an order exposes Flipkart to the rigours of an intrusive investigation affecting not only its credibility and reputation but also its commercial prospects.Meanwhile, the high court has issued an interim stay of the CCI probe.
“We are a party to the CCI order and a respondent in Amazon’s writ against the order. Given the court stay, as a procedural matter, we have filed a writ,” a Flipkart spokesperson said. Flipkart’s filing comes just days ahead of US President Donald Trump’s visit to India and amid concerns about the country is tightening foreign investment rules for the sector.
“Flipkart’s petition reflects that these firms are scared of probe giving rise to the belief that their model is suffering from anti-policy, anti-law activities,” said Praveen Khandelwal, secretary general, CAIT.