Govt to vet responses by Amazon, Flipkart on their India operations

E-commerce companies including Amazon and Flipkart have submitted their responses to the queries sent to them by the Department for Promotion of Industry and Internal Trade (DPIIT) on their operations in India, which are now being vetted by the government to see if existing rules might have been flouted, an official has said.

Queries on business details such as top sellers, pricing of goods by vendors, capital structure and inventory management system were posed to the e-commerce companies following complaints by brick-and-mortar retailers as well as online vendors alleging that these companies may be violating FDI rules.

“The DPIIT is in the process of going through the responses given by the companies to the queries. Future action will depend on the information received,” the official said.

The Confederation of Indian Traders (CAIT) has complained to the Centre about alleged violation of FDI rules by e-commerce majors and accused them of predatory pricing, deep discounting, controlling inventory and influencing prices.

The DPIIT then sent questionnaires to the e-commerce companies asking them to disclose information such as the names of top five sellers on their platform and the price of goods sold by preferred vendors and support to sellers to examine if they had a connection with sellers which could lead to the companies influencing prices of the items sold on their platform.

“It is too early for the DPIIT to comment on the information received as it is still being examined. If everything is in order we will let the matter be. If not, then it can be taken up with the appropriate authorities,” the official said.

The CAIT, in a press statement on Friday, said that it had convened a meeting of its National Governing Council on November 10 to take stock of the current situation and finalise the strategy for a movement to be launched from November 13.

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