E-com vs traders: Goyal to decide stance

Aommerce and industries minister Piyush Goyal who has rooted for investigations into alleged business malpractices of e-commerce giants including Amazon and Flipkart is likely to take the final call on what to do to address the ongoing tussle between e-tailers and brick-and-mortar traders. Goyal had earlier said in the Lok Sabha that the Department for Promotion of Industry and Internal trade (DPIIT) has been apprised of the matter and is looking into alleged anti-competitive practices like deep discounting, preferential treatment to the sellers and predatory pricing of products by e-tailers on their platforms.

The legal aspect of the tussle continues to brew on the side. The Karnataka High Court last week ordered a stay on the investigations by industry watchdog Competition Commission of India (CCI) for a period of two months. The court also directed the counsels of the trader organisations led by Confederation of All India Traders (CAIT) as well as e-commerce companies to file their responses after two months.Meanwhile, the CAIT has said that they will appeal against the Karnataka HC’s stay order and push the commerce, industries and finance ministries to look into alleged FDI violations by foreign companies like Amazon and Walmart-backed Flipkart. 

“The Commerce and Industries minister has spoken several times about the issue. We respect the Karnataka High Court’s decision to stay the CCI probe. However, we will have to wait for the commerce ministry’s announcement to see what route they wish to take in this dispute,” Union finance minister Nirmala Sitharaman told this publication. Amazon’s legal counsel team, however, told this paper that the company is fully compliant with all the FDI regulations as well as market practices and that a few groups of retailers have been harassing the companies by filing cases in various courts, which is bringing disrepute to the brand. 

The e-commerce major has told the court that the government has been supporting FDI into the country and pointed out that they want to probe it all of a sudden. However, CAIT general secretary Praveen Khandelwal noted that the court has explicitly brought up the ongoing probe of by the Enforcement Directorate into alleged FDI violations by e-commerce companies when it ordered the stay. “We want to know when the ED probe will be completed. It has been more than two years now. The ED falls under the purview of the finance ministry and we will be meeting (the finance minister) soon to apprise her about the matter,” Khandelwal added.

CCI probe stayed
The Karnataka HC had last week stayed an investigation into the matter ordered by the Competition Commission