Flipkart Challenges Court Order on Antitrust Probe on Select Seller Promotion

Walmart’s Flipkart has filed a legal challenge against the restarting of an antitrust probe into the company, arguing in a court filing that the investigation would cause “irreparable injury.”

The Competition Commission of India (CCI) launched an investigation in January last year following a complaint alleging that Flipkart and Amazon promoted select sellers on their e-commerce platforms and used deep discounts to stifle competition.

The companies have denied wrongdoing and near-immediate legal challenges from the pair stalled the probe for more than a year until a court last week ruled it could resume, having dismissed arguments that the CCI lacked evidence.

The fresh appeal from Flipkart, filed on June 16, argues that decision by the Karnataka court to allow the probe to resume was erroneous and must be put on hold.

“Irreparable injury will be caused to the appellant if the investigation was to continue pending the present appeal,” the filing, which was not made public but has been viewed by Reuters, said.

It also urged the court to quash the initial CCI order for the investigation.

Flipkart and CCI did not immediately respond to requests for comment.

Amazon, which industry sources said was expected to file a similar challenge, declined to comment.

Sources told Reuters earlier this week that the CCI planned to expedite the investigation as it intensifies scrutiny of big-tech firms, Reuters reported this week. The CCI plans to demand information from Flipkart and Amazon to the allegations “as quickly as possible”, one source said, contrary to the several months such probes usually take.

Both Amazon and Flipkart are currently battling accusations from offline retailers that their complex business structures allow them to circumvent foreign investment rules for e-commerce.

In February, a Reuters investigation based on Amazon documents showed the e-tailer for years gave preferential treatment to a small group of sellers on its Indian platform. Amazon has said it “does not give preferential treatment to any seller”.

© Thomson Reuters 2021