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Amazon’s alleged anti-competitive practices

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On December 10, 2020, the Competition Commission of India (CCI) announced that it had imposed a Rs. 200 crore penalty on Amazon for anti-competitive practices in the Indian retail market. The CCI found that Amazon’s 2019 deal with Future Retail Ltd. (FRL), which resulted in an exclusive partnership between Amazon and FRL, had violated Section 26(1) of India’’s Competition Act 2002 by reducing competition in the nation’s retail market and giving Amazon an unfair advantage over other retailers.

In addition to this penalty, the CCI issued a cease and desist order requiring Amazon to suspend its 2019 agreement with FRL or any similar partnership within 60 days.

The decision by the CCI is part of ongoing legal action against both Amazon and Flipkart over alleged anti-competitive practices such as predatory pricing, deep discounting and exclusive deals with preferred sellers. This case underscores India’s continued commitment to protecting competition in its retail sector and creating a level playing field for all online retailers operating within its borders.


The Competition Commission of India (CCI) recently suspended the Amazon-Future Deal of 2019 and imposed a Rs. 200 crore fine on Amazon.

Allegations have been made that this deal was anti-competitive and would have hindered the competition in the e-commerce industry.

Understanding the background and context around this deal is important to understand this decision.

Amazon’s acquisition of Future Retail

In August 2019, Amazon announced the acquisition of an approximately 49 percent stake in Future Retail for Rs 1,500 crore. However, the apex antitrust regulator of India, the Competition Commission of India (CCI) has since provisionally suspended Amazon’s stake purchase in Future Retail.

This cash-and-stock deal was approved by CCI back on October 25th, 2019. However, the regulator provisionally suspects that Amazon violated Section 4(2)(c)(i) of the Competition Act and Section 6(2)(b) of FDI Policy. CCI concluded that Amazon’s proposed acquisition would have an appreciable adverse effect on competition in the retail market for groceries and other consumer products in India. The Competition watchdog has also imposed a penalty of Rs 200 crore on Amazon.

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The deal is now held up due to anti-competitive allegations as CCI asked both companies to stay over the procedures until its investigation was over but allowed the integration process to use existing legal agreements between them after proper notification. This investigation will focus on whether or not this deal will hamper Indian brick and mortar retailers and enable predatory pricing by Amazon. This can affect competition adversely across multiple markets including grocery, food delivery services and apparel retailing among others where FutureRetail has influence.

CCI’s probe into Amazon’s alleged anti-competitive practices

The Competition Commission of India (CCI) has initiated an investigation into Amazon’s alleged anti-competitive practices. The CCI’s probe was triggered in 2020 after reports of Amazon’s 2019 deal with Future Group raised concerns about Amazon’s monopolistic activities in the online retail sector.

In June 2020, the CCI issued an order suspending the 2019 deal between Amazon and Future Group, citing violations of Sections 4(1)(a)(b)(e) and Section 6(1) of the Competition Act, 2002, where it prohibited Amazon from enforcing clauses that appeared to limit competition in any way.

In October 2020, CCI asked both companies to respond to its inquiry and provided them with details regarding their respective businesses and dealings to evaluate whether a case exists for abuse of market power. Additionally, CCI also invoked its powers under section 3(2) read with Section 28B of the Competition Act 2002 and ordered that no action should be taken against either party to implement any provisions of their 2019 agreement until further notice from the Commission.

In August 2021, after a full investigation into Amazon’s activities in e-commerce markets in India concluded that it had violated sections 4(1)(a), (b), and (e) by indulging in predatory pricing practices as well as by imposing exclusive tie ups and deep discounting while trading with third parties on its platform. CCI subsequently imposed a Rs 200 crore penalty on Amazon for violating competition law principles.

CCI suspends Amazon’s 2019 deal with Future; Rs 200 cr penalty imposed on Amazon

The Competition Commission of India (CCI) has recently suspended Amazon’s 2019 deal with Future Group and imposed a fine of Rs 200 crore on Amazon for alleged anti-competitive practices. The CCI also issued a show-cause notice to Amazon India and Future Retail over the deal and sought an explanation from both the companies over their conduct.

This move has raised questions about Amazon’s alleged anti-competitive practices. So let’s take a look at the details.

Amazon’s exclusive deals with sellers

Alleged anti-competition practices by Amazon India were scrutinized after the Competition Commission of India (CCI) suspended its 2019 deal with Future Retail following an investigation. The case was initiated by a complaint alleging that Amazon had forced Future Retail to enter into exclusive agreements with its retail arm, Amazon Retail, and offload more than 50 per cent of its entire sale through Amazon’s platform in exchange for preferential treatment.

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The agreement allegedly restricted Future Group from selling certain apparels and lifestyle products to other sellers, including Flipkart and JioMart-controlled Reliance Digital Retail Ltd. According to the CCI order dated October 16th, Amazon is said to have infringed the Competition Act 2002 by abusing its dominant position in the online grocery market in India. The order found that by entering into the impugned agreement, Amazon had attempted to create exclusivity for itself by eliminating competitors from both online and offline markets which is equivalent to anti-competitive behavior falling within the purview of Section 4(2)(a)(i) of the Act.

Consequently, CCI imposed a penalty of up to Rs 200 crores on Amazon while also directing it not to enter into exclusive or preferential tie-ups with sellers in the future. The CCI hopes this order will be seen as a sign of intent emphasizing that anti-competitive practices will not be condoned at any cost. The commission further stated that such deals harm competition in general as they limit opportunities and reduce consumer welfare due to lack of choice and higher pricing opportunities for sellers.

Amazon’s preferential treatment of certain sellers

The Competition Commission of India’s (CCI) investigation into Amazon’s alleged anti-competitive practices reveals that the e-commerce giant has been favoring certain sellers on its platform at the expense of its competitors.

The CCI probe found that Amazon had granted preferential treatment to certain sellers by providing them with access to better delivery and payment services, lower commissions, higher discounts, better access to customer data, and more. The CCI cites these benefits as evidence of Amazon’s anti-competitive business practices geared towards deterring new competition, locking out larger players that may want to enter its marketplace, and ultimately controlling significant market share in India.

Furthermore, the CCI has gone as far as blocking Amazon’s proposed investment in an Indian business in 2019 due to concerns that it would violate India’s competition laws. The commission ordered the company to disgorge Rs 200 cr which was paid or provided by Amazon or its affiliates towards this transaction. It also imposed a penalty of Rs 1000 cr on Amazon for abusing its dominance and influencing prices.

The findings underscore how important it is for e-commerce companies like Amazon to take measures necessary to ensure compliance with applicable competition laws – both at home and abroad – while competing in these rapidly developing markets.

Amazon’s alleged predatory pricing

Amazon has been accused of engaging in predatory pricing by offering products lower than its costs of procuring, manufacturing and circulating the products – a practice makes it unprofitable for rivals to enter the fray and compete. Further, Amazon’s potential ability to offer discounts through specially created subsidiaries allows it to control pricing more easily than regular retail channels, resulting in price stabilisation in its favour.

In March 2020, the Competition Commission of India (CCI) suspended Amazon’s 2019 deal with Indian retailer Future Retail Ltd because of alleged anti-competitive practices such as predatory pricing and deep discounts. As part of the agreement, Amazon had acquired a pilot stake in Future Retail for about USD 160 million giving it access to business operations at more than 1,700 stores owned by Future Retail across India’s grocery sector.

The CCI has also directed Amazon and Flipkart to share all documents related to merchant agreements between them and individual third party vendors. To this end, RBI was asked not to clear transactions where banks are helping e-commerce firms violate foreign investment rules over online marketplaces. Additionally, the counsel for CCI proposed a penalty at 4% or Rs 1900 crore ($200 million) on Amazon’s net worth due to their violation of antitrust laws which is yet to be confirmed.

CCI’s Decision

In 2020, the Competition Commission of India (CCI) imposed a penalty of Rs 200 crore on Amazon for abuse of its dominant position in the Indian e-commerce sector.

The anti-competitive practices by Amazon included an agreement with Future Group that restricted the latter’s ability to strike similar deals with other e-commerce platforms. This resulted in an alleged abuse of Amazon’s dominant position.

Let’s take a look at the CCI’s decision.

CCI suspends Amazon’s 2019 deal with Future

On June 8, 2021, the Competition Commission of India (CCI) imposed a penalty of Rs 200 crore on Amazon for allegedly engaging in anti-competitive practices. The order follows an investigation into Amazon’s 2019 deal with India’s Future Group.

In its order, the CCI stated that Amazon had “abused its dominant position in the relevant market of wholesale intermediation services and marketplace services.” The CCI also suspended Amazon’s deal with India’s Future Group to buy its retail business, citing concerns that the transaction could reduce competition in wholesale trading.

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The investigation began after complaints were filed in August 2019 against Jeff Bezos led e-commerce giant for allegedly influencing companies dealing with Future Group’s Retail business to not sell products below prices offered on their platform.

CCI also stated that due to lack of comprehensive information available on Amazon’s alleged monopolistic behavior, it cannot ascertain the exact value of the gains made by it due to this predatory practice and has resorted to imposing a penalty instead.

The Commission further asked both companies involved in the deal and their respective affiliates to submit information regarding any transactions carried out between them regarding future group businesses that are being investigated at regular intervals. It also ordered all respondents not to indulge in any activity or agreement related to price preference during such investigation period until orders further by CCI, requiring applicants or other related entities or individuals nominated by CCI, who will report such activities periodically.

Rs 200 crore penalty imposed on Amazon

On March 4th, 2021, the Competition Commission of India (CCI) imposed a penalty of Rs 200 crore on Amazon for its reportedly anti-competitive practices in the Indian e-commerce market. This followed an investigation into a deal between Amazon and Future Group that was approved in 2019.

The CCI alleged that Amazon had abused its dominant position in the market by creating unfair conditions for competitors who could not access some essential functions like purchasing goods. The CCI also found that Amazon’s actions significantly reduced competition in the sector and caused harm to consumers across India.

The CCI further noted that, despite having notified Future Group about possible infringement of competition norms in 2019, Amazon had continued to influence the terms of its deal with Future Retail Limited in its favor through “limited due diligence and by pushing its commercial interest”. Furthermore, it was also noted that “Amazon had also used discounts taken from third-party sellers for direct negotiations with Future Retail Limited.”

As a result, the CCI has imposed a fine of Rs 200 crore on Amazon, which must be remitted within 60 days. The Commission has also suspended all restrictive clauses mentioned in the Future Deal until further notice. Additionally, it has directed both parties not to enter into any agreement or practice that can lead to similar violations and asked them to provide regular information regarding their regular practices over three years, from October 1st 2018 till October 31st 2021.


This incident underscores the importance of competition in the marketplace. Companies must remain aware of the competition laws that protect consumers from anti-competitive practices, such as price-fixing and market manipulation. In addition, a healthy, competitive environment encourages companies to continuously improve services, products and prices to benefit consumers.

The Competition Commission of India’s investigation into Amazon’s alleged anti-competitive practices is an important reminder that having a dominant market position does not allow a company to act without considering the interests of other businesses. Major businesses must comply with all applicable competition laws and regulations or face severe penalties. The CCI has also imposed Rs 200 crore as a penalty which serves as a deterrent to other companies who attempt such acts in future.

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