India’s antitrust regulator has accused Amazon Inc. of concealing facts and making false statements when seeking approval for a 2019 investment in the Future Group, a letter to US major e-commerce seen by Reuters has indicated.
The letter involves the bitter Amazon legal battle with the Future Group over an Indian company’s decision to sell its goods for sale to Reliance Industries – a matter before the Supreme Court of India.
Amazon has argued that the terms agreed in its 2019 agreement to pay $ 192 million for a 49% share in the Future voucher category prevents its parent, Future Group, from selling its Future Retail Ltd business in Reliance.
In a letter dated June 4, the Competition Commission of India (CCI) said Amazon had concealed certain details about the transaction by not disclosing its interest in Future Retail when it sought approval for the 2019 agreement.
“Amazon’s submissions and conduct before the Commission are tantamount to misrepresentation, making false statements and pressuring and / or concealing facts,” the letter said. It also noted that its review of the submissions made was caused by a complaint from Future Group.
In a four-page book, called ‘show cause notification’, CCI asked Amazon why it should not take action and punish the company for providing false information.
Amazon is yet to respond, according to a source familiar with the matter who declined to be named as the book has not been released to the public.
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Amazon said in a statement sent to Reuters that it had received a letter, committed to compliance with Indian laws and would extend its full cooperation with the CCI.
“We are confident that we will be able to deal with CCI complaints,” she said.
Representatives for Future and CCI did not respond to Reuters’s request for comment.
Vaibhav Choukse, a competitive legal expert and co-founder at J. Sagar Associates, said it is not uncommon for the CCI to issue such a notice and that if the CCI is not satisfied with Amazon’s response, it could lead to a fine and a review of the agreement.
“The CCI has great powers that include guidelines for re-applying for approval and even withdrawing a permit under different circumstances,” Choukse said.
The CCI’s mandate for 2019 states that its decision “will be suspended if, at any time, the information provided” is found to be incorrect.
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The dispute over Future Retail, with more than 1,500 stores and other stores, is a bright spot between Jeff Bezos’ Amazon and Reliance, owned by India’s richest man Mukesh Ambani, as they try to get a higher hand in winning nationwide purchases.
Amazon also faces many challenges in India, an important growth market where it has invested $ 6.5 billion in investment, including a separate CCI investigation into allegations that small businesses say they have hurt themselves.
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In addition, it faces the prospect of a number of laws that could ban the sale of private labels and will prevent a US company from allowing its organizations to list products on its website.
The CCI letter compared the three sets of submissions Amazon made in 2019 to later submissions in other legal forums, calling them “contradictory.”
In particular, it said Amazon had described its interest in investing in the Future coupon unit as one that would address gaps in the Indian payment industry. But the letter states that Amazon has indicated in other legal forums that the basis of its relationship with Future Coupon for certain exclusive rights acquired through Future Retail.
“Amazon has concealed its interest” in Future Retail, the letter said, adding: “Such interest and intent for the merger … has not been disclosed to the Commission despite specific requirements.”
CCI also disputed a single clause in which Amazon had told the regulator that it had not entered into a single legal agreement for the two future parties to sign between them days before its 2019 agreement. But Amazon later said before the mediator that the agreement was “an integral part” of the transaction, the letter said.
