Report: Amazon and Flipkart Broke India’s Competition Laws
Amazon and Walmart-owned Flipkart have reportedly been accused of violating India’s antitrust laws.
An investigation found that the two eCommerce rivals broke the competition rules by prioritizing select sellers on their websites, Reuters reported Thursday (Sept. 12), citing reports by the Competition Commission of India (CCI).
The CCI had launched an investigation in 2020 to see whether the companies had promoted certain merchants with whom they had business deals, and to whether they had given priority to certain listings, the report said.
A pair of reports from the CCI said investigators determined the two companies created a system where preferred sellers ranked higher in search results, pushing out rivals.
“Each of the anti-competitive practices alleged … were investigated and found to be true,” said both reports, which were not public and were part of an exclusive by Reuters.
“Ordinary sellers remained as mere database entries,” the CCI reports concluded.
PYMNTS has contacted Amazon and Flipkart for comment but has not yet gotten a reply.
The investigation comes as both Amazon and Walmart look to India — the most populous country in the world — to boost revenues.
Amazon announced last summer it planned to invest $26 billion in India by 2030. The company did not offer specifics, though it had previously said Amazon Web Services was investing $12.9 billion in the country, along with a $6.5 billion investment in its Indian eCommerce business.
Walmart, meanwhile, has said it is counting on its investments in Flipkart and Indian payments provider PhonePe to help it reach its goal of doubling its overseas gross merchandise volume to $200 billion by 2028.
“It is not crazy to think that both those businesses could be $100 billion businesses in the future,” Walmart Chief Financial Officer John David Rainey said at a conference last year.
In more recent news about the rivalry, PYMNTS reported that Amazon was bolstering its presence in third-party grocery delivery, aiming to shrink Walmart’s lead in food. That meant two partnerships: a new one with Seattle’s Metropolitan Market, and an expanded collaboration with East Coast grocery chain Weis Markets.
“The move comes as Amazon looks to grow its presence in grocery — the one retail category in which it trails behind competitor Walmart by a wide margin,” PYMNTS wrote, pointing to research showing Walmart captured a share of consumer grocery spending seven times the size of Amazon’s.
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