The Karnataka HC will shortly hear two pleas moved by Amazon and Flipkart seeking to quash the probe ordered by the Competition Commission of India (CCI) for alleged violations of Competition Law.
@amazonIN
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Senior Adv Gopal Subramanium, appearing for Amazon: Last hearing, Your Lordship had posted the matter for final hearing today. I am ready to open the case, milord.
The Bench is now looking into the IAs.
Bench: Who is the lawyer in IA 1 of 2021? There is still some confusion.
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Bench: Who is the lawyer in IA 1 of 2021? There is still some confusion.
@CCI_India
@amazonIN
@Flipkart
Subramaniam is giving a brief overview of the matter.
Subramanium: The conditions imposed on an online platform is that
- they cannot do Business to Consumer but only B to B.
- No exclusivity of products
- Can provide ancillary services.
- they cannot do Business to Consumer but only B to B.
- No exclusivity of products
- Can provide ancillary services.
Subramanium: Delhi Mahasang Vyaphar's allegations are that Amazon has exclusivity which respect to Mobile phones.
The second one is that Amazon does "deep discounting" with respect to products.
Any discount or slash of price is done by the dealer or seller of the product.
The second one is that Amazon does "deep discounting" with respect to products.
Any discount or slash of price is done by the dealer or seller of the product.
Amazon has no say in that. We are only a platform, Subramanium contends.
No preference is shown to any seller as it is prohibited by the FDI policy, he adds. There is no distinction made by Amazon for its dealers.
No preference is shown to any seller as it is prohibited by the FDI policy, he adds. There is no distinction made by Amazon for its dealers.
Those who have higher ratings, better sales are chosen by the algorithm. They are given rebates but really speaking, there is no preference given by Amazon to its sellers, Subramanium.
The CCI order ordering probe into Amazon, Flipkart is problematic because it is arbitrary and ultra vires of the Competition Act: Subramanium
CCI says that investigations are happening in other jurisdictions. But that is irrelevant here, Subramanium.
Next is the bonafide of the informant. If the CAIT has filed multiple petitions against Amazon and not able to procure favourable orders and then goes to CCI for the same purpose, the same is prima facie out of place: Subramanium
Subramanium: CCI has not taken note of the fact that Delhi HC has passed orders in the matter. ED was looking into the matter in 2015 but there is nothing even remotely to suggest that we are acting against the FDI policy.
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@CCI_India
Subramanium refers to a Supreme Court judgment to state that even primafacie orders must be passed after application of mind and based on proper information.
Submramanium: Matters under section 19(3) of the Competition Act must await final orders.
Subramanium: On these points, the stand taken by CCI is amenable to judicial review. This is a classic case where a 226 petition in maintainable.
Subramanium: CCI's decision, if I may, is flagrantly in violation of the Competition Act, whose objective is to facilitate competition.
To investigate into an online platform, there must be proper info and reason: Subramanium
To investigate into an online platform, there must be proper info and reason: Subramanium
Subramanium: It (Amazon) is a platform which carries out competition. The CCI itself has acknowledged that this a platform for intermediaries and buyers.
Subramanium now reads the preamble of the Competition Act.
"An Act to provide, keeping in view of the economic development of the country, for the
establishment of a Commission to prevent practices having adverse effect on competition, to
promote and sustain....
"An Act to provide, keeping in view of the economic development of the country, for the
establishment of a Commission to prevent practices having adverse effect on competition, to
promote and sustain....
.......competition in markets, to protect the interests of consumers and to
ensure freedom of trade carried on by other participants in markets, in India, and for matters
connected therewith or incidental thereto."
ensure freedom of trade carried on by other participants in markets, in India, and for matters
connected therewith or incidental thereto."
Subramanium: By questioning a market platform, you are raising doubts in the minds of the participants - manufacturers, sellers and the buyers themselves.
He now reads the definition of Agreement [section 2 (b)] and Relevant product market [section 2 (t)]
Subramanium: The CCI order, milord, is not in context of services but in the context of products, namely Mobile phones.
On Exclusivity
Subramanium: Who decides in exclusive launch? The brands - like Apple or Samsung.
Amazon has no say in this. They decide to have an exclusive launch for two weeks or likewise.
Subramanium: Who decides in exclusive launch? The brands - like Apple or Samsung.
Amazon has no say in this. They decide to have an exclusive launch for two weeks or likewise.
Deep discounting
This is offered by the seller and I don't control a seller, Subramanium.
This is offered by the seller and I don't control a seller, Subramanium.
Justice Kumar: How much time will you take? I need to make some adjustments.
Subramanium: I will take about 5-6 hours, milord as it is a final hearing.
Subramanium: I will take about 5-6 hours, milord as it is a final hearing.
Justice Kumar: I have some misc work now. Let's take it up tomorrow at 3:30 pm. Sorry, one of the hon'ble judges is retiring tomorrow. Day after tomorrow, 3:30 PM.
The matter has been adjourned to January 20, 3:30 PM.
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