CCI assures action against unethical competition by e-comm firms: CAIT

Confederation of All India Traders (CAIT) has been fighting tooth and nail against Flipkart and Amazon India over continuous violation of FDI rules. The traders representing body is leaving no stone unturned to rake in regulators and government’s support against the marketplaces.

A day after Commerce Minister Piyush Goyal emphasised on strict observance of FDI policy and stringent action against flouters; the traders body has reached out to Competition Commission of India (CCI).

Traders body representatives have met CCI chairman AK Gupta and briefed him about the current situation of e-comm trade in the country. They appealed him to take action on Flipkart and Amazon for their involvement in illegal and unethical practices.

CAIT also submitted evidence and documents related to predatory pricing, giving huge discounts and compensating the losses to their sellers by Amazon and Flipkart. It urged the CCI to establish a fair market in the country.

Gupta after hearing traders body complain, assured action against such unethical practices.

"The commission is committed to establishing a uniform and competitive business environment in the country, and if anyone adopts unhealthy trading practices, influencing prices in any manner and create an uneven level playing field in the market, the Commission will sure take action as per law," Gupta said in a press statement released by CAIT.

CAIT’s president BC Bhartia and Secretary General Praveen Khandelwal represented the body in the meeting with Gupta. Economic Adviser of the Commission Payal Malik also attended the meeting.

According to CAIT, about 40,000 mobile shops are on the verge of closure by Diwali, while FMCG, electronics, electrical, gift items, garments, watches etc. have suffered considerable losses in the offline market.

“Business in smartphones has fallen to about 60% whereas in other sectors it has registered a decline of 30% to 40% sales,” said Khandelwal.

Early this week, Goyal emphasised that the government will take stringent action against those who are flouting FDI rules. “No e-commerce marketplace can illegally leverage multi-brand policy for the growth of the electronic marketplace,” he said while answering an audience question in a function.

Recently, CAIT even had raised questions on the business model of e-comm firms and requested an independent audit. On the documents submitted by CAIT, Gupta assured a detailed study by the commission.

CCI will decide what action should be taken on the basis of its study and findings, he added.

However, both e-comm firms - Amazon and Flipkart - have denied being flouting FDI norms and offering excessive discounts. Last week, in a meet with traders body, the duo said they do not provide the discounts but brands on their platforms.

For the past few months, the trader bodies including CAIT, AOIVA and others have been continuously raising the issue of deep discounting, predatory pricing and exclusive deals. CAIT also filed a petition in Jodhpur bench of Rajasthan High Court. The court had asked the union government to respond on the petition within a fortnight. It will hear the case on November 11.