Comments
In a setback for Amazon, the National Company Law Appellate Tribunal (NCLAT) has reaffirmed the Competition Commission of India’s (CCI) order to suspend approval for the investment deal between Amazon and a Future group firm dating back to 2019. The NCLAT has directed Amazon to pay ₹200 crore fine. Amazon is likely to appeal against the order.
The two-judge-bench comprising Justice M Venugopal and Ashok Kumar Mishra also upheld the ₹200-crore fine imposed on Amazon and granted the company 45 days to pay. This fine is imposed for non-disclosure of relevant information on combinations under Section 43A of the Competition Act, 2002.
Failed to notify
Confirming the CCI’s ruling, the NCLAT said it is in full agreement with the anti-trust watchdog that Amazon had not made a “full, fair, forthright” disclosure about its strategic interest in Future Retail Ltd, Future group’s public listed company, which ran its flagship banner of Big Bazaar outlets. Amazon failed to notify the relevant information pertaining to the combination of the agreements, the NCLAT said, agreeing with the CCI’s reasoning.
This essentially means Amazon’s 2019 deal with Future Coupons has been put in abeyance as per the previous order. It also ordered Amazon to refile the combination notice under the long-form (Form II). Form II is applicable for enterprises whose combined market share is more than 15 per cent, and 25 per cent of the overall relevant market.
“Amazon now has the option to appeal the NCLAT order before the Supreme Court or refile the combination notice under Form II with the CCI. However, NCLAT endorsing the CCI’s decision is likely to increase Amazon’s troubles in India, where the latter is also engaged in various proceedings before the Delhi High Court and Singapore International Arbitration Centre (SIAC) tribunal,” Ketan Mukhija, Partner, Link Legal explained.
According to people in the know, “Amazon will appeal against the said order, it has no choice.” NCLAT concluded its hearing on Amazon’s plea in April this year. All parties had filed revised notes of submissions along with relevant citations before the registry.
Order welcomed
Amazon had opposed FRL’s deal to sell assets to Reliance Retail as part of a ₹24,713-crore deal, which has now been called off. On Monday, apart from Amazon’s plea, the appellate tribunal also reserved the order on two other petitions in the matter filed by the Confederation of All India Traders (CAIT) and the All India Consumer Products’ Distributors Federation (AICPDF).
Praveen Khandelwal, Secretary-General, Confederation of All India Traders, said: “We at CAIT India welcome the order, which clearly states the wrongdoings of Amazon. Any plot to capture the e-commerce and retail trade of India will not be successful. India is not a banana republic and laws are not weak.”
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.