Indian competition authorities criticize Amazon and Flipkart: Preferential treatment and discounts under scrutiny

Indian competition regulators have uncovered violations of local competition laws by Amazon and Flipkart in recent investigations. According to reports viewed by Reuters from the Competition Commission of India (CCI), the two e-commerce giants have harmed other businesses by favoring certain sellers, prioritizing specific product listings, and offering massive discounts. The investigation results reveal that Amazon had six favored sellers, while Flipkart favored 33 sellers. These sellers received marketing, warehousing, and other services with minimal effort, according to the CCI. These practices were funded through foreign investments by the companies. The CCI emphasizes that this ecosystem at both Amazon and Flipkart makes it nearly impossible for other sellers to compete. The majority of the products that appeared at the top of search results on both platforms were from these favored sellers, creating barriers for other merchants, according to the CCI report. Another finding concerns exclusive product launches: Amazon and Flipkart collaborated with smartphone and technology companies to launch their devices exclusively. This strategy significantly disadvantaged smaller retailers, who received the products much later. These partnerships not only impacted regular sellers on the platforms but also brick-and-mortar retailers. Additionally, the competition regulators found that both companies allowed their favored sellers to offer significant discounts, often far below production costs. This practice is aimed at driving competition out of the market. Amazon, Flipkart, and the CCI have refused to respond to inquiries about the reports.