The Competition Commission of India (CCI) has reportedly accused Samsung and Xiaomi, along with other smartphone companies, of colluding with e-commerce giants Amazon and Flipkart to feature exclusive product launches that violate India"s antitrust laws. According to the antitrust watchdog, these companies only favoured limited sellers and engaged in business practices that harmed other ordinary sellers on their platform, affecting competition and consumer interests.
The investigation was started as part of a lawsuit that was filed by the Delhi Vyapar Mahasangh (DVM) against Flipkart Internet Private Limited and Amazon Seller Services Private Limited, the companies" registered entities in India. The DVM is part of India"s largest trade association, the Confederation of All India Traders, and represents several Micro, Small, and Medium Enterprises (MSME) traders of New Delhi. It said that both these e-commerce platforms engaged in anti-competitive practices that harmed small local traders selling smartphones and related accessories online, and also the brick-and-mortar retailers who had delayed access to those smartphones.
In its filing, the DVM said that Flipkart and Amazon had agreements with a select group of preferred sellers who were either directly or indirectly affiliated with them. These sellers had significant advantages such as better pricing, preferential listings, and deep discounts during major sales events such as Flipkart"s Big Billion Days and Amazon"s Prime Day Sale.
According to Reuters, the same was evident from the CCI"s reports which said that five companies, Samsung, Xiaomi, Motorola, Realme, and OnePlus colluded with Amazon and its affiliates and were involved in the practice of exclusive phone launches, which opposes the competition laws of India. Flipkart had similar exclusive launches with Samsung, Xiaomi, Motorola, Vivo, Lenovo, and Realme. The report also said that both Flipkart and Amazon downplayed the allegation of exclusive launches though the practice was "rampant" in reality.
For now, the CCI has mandated regulatory actions on the e-commerce companies and asked them to submit their financial records for the past three fiscal years. In the coming weeks, the watchdog will review any objections to its findings, and could potentially impose fines while mandating companies to change their business practices.
via Reuters