Amazon fails to quash investigation into its Indian selling practices
Source: The Guardian and agencies
Amazon fails to quash investigation into its Indian selling practices
Inquiry will include companys £1bn-a-year joint venture with Rishi Sunaks father-in-law
Simon Goodley and agencies
Fri 11 Jun 2021 16.21 BST
The Indian competition commission is to relaunch an investigation into Amazons selling practices, which will examine the companys £1bn-a-year joint venture with UK chancellor Rishi Sunaks billionaire father-in-law.
The investigation, originally announced in January 2020, will proceed after an Indian court on Friday dismissed pleas by Amazon and its rival the Walmart-owned Flipkart to quash its investigation into the business practices of the huge US retailers.
One of the largest sellers on Amazon.in is a company called Cloudtail, a £1bn revenue business that is 76% controlled by Sunaks wealthy in-laws, the Murthy family. The remaining quarter of Cloudtail is owned by Amazon.
The Competition Commission of India (CCI) will examine complaints by a traders group that small sellers are being driven out of business because the big US platforms are giving preferential treatment to preferred sellers.
Under Indias foreign direct investment law, overseas companies are banned from running an online retailer that holds inventory and then sells the goods directly to Indian consumers online. So instead, US websites such as Amazon.in are run as a marketplace, with Indian retailers selling their products via the site in return for paying the US company a fee. Small traders allege they are being disadvantaged because the US platforms may be favouring a few big sellers, including Cloudtail.
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