Amazon India denies it gives select sellers preferential treatment

BENGALURU/MUMBAI (Reuters) - Amazon’s Indian business has denied accusations that it favors select merchants and brands, responding to a complaint lodged by an Indian lobby group.

FILE PHOTO: A shipment moves on a conveyor belt at an Amazon Fulfillment Centre (BLR7) on the outskirts of Bengaluru, India, September 18, 2018. REUTERS/ Abhishek N. Chinnappa/File Photo

The All India Online Vendors Association (AIOVA) on Friday filed a petition with the Competition Commission of India (CCI) alleging that the online retailer favors merchants that it partly owns, such as Cloudtail and Appario.

The company said on Monday that all sellers on its platform are treated equally.

“Amazon has an equal relationship with all the sellers on our marketplace,” Amazon India spokeswoman Bhumika Shah said in an email, adding that the company is “absolutely committed” to compliance with local laws.

AIOVA, which represents more than 3,500 online sellers, said that large sellers such as Cloudtail and Appario were being charged significantly less than Amazon’s advertised rates.

Cloudtail is owned by Prione Business Services, which is a joint venture between Amazon and Infosys co-founder N.R Narayana Murthy’s Catamaran Ventures. Appario is a joint venture between Amazon and Patni group.

“There should not be any preferential treatment,” AIOVA’s lawyer, Chanakya Basa, said on Monday.

India has a burgeoning e-commerce market, with almost 500 million Indians using the Internet in 2018 and the e-commerce market is tipped to grow to $200 billion in a decade, according to Morgan Stanley.

AIOVA has asked the antitrust regulator to impose a “severe penalty” for unfair practices and to restrict what it says are “preferred sellers” from participating in Amazon India’s annual festival sales, which start this week.

The lobby group filed a similar petition against Walmart-owned Flipkart in May, alleging violation of competition rules through preferential treatment for select sellers. AIOVA also asked for restrictions to be placed on Flipkart’s festival sale this week.

Flipkart did not immediately respond to a Reuters request for comment.

Amazon has scheduled its Great Indian Festival sale over Oct. 10-15 and Flipkart’s Big Billion Days sale is scheduled for Oct. 10-14, according to their websites.

Reporting by Krishna V Kurup in Bengaluru and Sankalp Phartiyal in Mumbai; Additional reporting by Mekhla Raina and Tanvi Mehta in Bengaluru; Editing by Euan Rocha and David Goodman