Amazon and Flipkart could come under scrutiny for alleged seller bias ahead of big festive sales
The Competition Commission of India (CCI) has launched an investigation into Amazon and Flipkart, alleging violations of local competition regulations. The probe, which began in 2020, alleges that the major US e-commerce platforms have shown preferential treatment to specific sellers on their websites. This preferential treatment allegedly includes prioritizing certain listings and providing additional benefits to preferred sellers.
Extensive report on Amazon and Flipkart filed
According to Reuters, the CCI filed extensive reports on both companies—1,027 pages on Amazon and 1,696 pages on Flipkart. The documents show that both platforms set up systems that prioritize selected sellers, boosting their visibility in search results.
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CCI reports have suggested that these practices have given some sellers a significant advantage. The Amazon report notes that favored sellers have their products featured more prominently in searches, which impacts customer attention and market competition. Similarly, the Flipkart report notes that favored sellers have received marketing and logistics support at very low cost, which Flipkart allegedly used to offer phones at below market prices, a practice it describes as “predatory pricing.”
The findings also suggest that these anti-competitive practices extend beyond mobile phones to other product categories. The reports are a significant challenge to both companies, which have faced criticism from smaller retailers who say deep discounts and preferential treatment have harmed their businesses.
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Amazon and Flipkart respond to allegations
Both Amazon and Flipkart have denied any wrongdoing and have maintained that their operations comply with Indian regulations. The companies are expected to review the CCI’s findings and address any concerns before deciding on potential penalties. The scrutiny adds to existing tensions, highlighted by recent criticism from India’s commerce minister, Piyush Goyal, who accused Amazon of using investments to offset losses.
