'Amazon Lied About Scope Of Our Approval,' Says CCI

The Competition Commission of India continued its arguments before the National Company Law Appellate Tribunal on Wednesday. The regulator focused its arguments on the alleged contradictory statements by Amazon.com NV Investment before the Singapore-based arbitral tribunal and the CCI.

Pointing to Amazon's submissions, Additional Solicitor General of India N Venkataraman said the company told the tribunal that the CCI had concluded “that the presence of FRL and the claimant’s [Amazon] affiliates in the overall B2C retail segment or in narrower segments was not such as to raise any competition concern”.

The scope of the approval was only the coupons gift and payment and FRL’s role in that was of a coupon issuer, Venkataraman emphasized.

Amazon lied to the arbitral tribunal that the competition commission had carefully considered the company's stand that Future Retail and its retail assets were a material inducement for the investment before granting the 2019 approval.

Venkataraman read out portions from the request for information that was sent by the commission in 2019. The RFI included questions on the nature of the rights being acquired by Amazon as a result of the transaction.

On that basis, the CCI approved the transaction for the coupons, gift and payments business where Future Retail’s role was limited as a coupon issuer, Venkataraman said.

Venkatarman went on to argue that both the emergency arbitrator and the main arbitral tribunal had overstepped by giving findings on the meaning and scope of the CCI‘s 2019 order.

The ASG's reference reveals the EA's conclusions, which said Amazon’s transaction with Future Group appeared to be permissible under the Indian laws and did not confer any control to the U.S. e-commerce major over Future Retail.

The main tribunal, too, made similar observations in its 2021 order in which it declined to vacate the emergency arbitrator’s order.

It had noted that all the agreements were disclosed to the CCI and concluded that Future Retail failed to establish that Amazon had spoken inconsistently before the CCI and in the arbitration proceedings.

The tribunal also noted that the negative, protective, special and material rights that would accrue to Amazon were disclosed to the CCI. Amazon had not hid its interest in Future Retail in its submissions to the CCI, the arbitral tribunal had said.

Through these conclusions, Venkataraman argued, the arbitral tribunal adjudicated on issues which are within the powers of the CCI.

The tribunals should have gone either by the CCI‘s 2019 order or waited for the CCI’s suspension order. "How can they run the distance before us? This trend is shockingly alarming".

In the last hearing, Venkataraman had stated there was misrepresentation and concealment by Amazon which culminated into a fraud.

In December, the competition regulator had suspended approval to Amazon's deal with Future Coupons Pvt. and imposed a Rs 200-crore penalty saying that there was a failure to adequately identify and notify Amazon’s strategic interest in Future Retail.

Amazon has challenged this order before the NCLAT.

The company has maintained that all the relevant details and agreements along with their competition assessment was presented to the commission while seeking the approval.

Amazon's lawyer Senior Advocate Gopal Subramanium based his challenge to the suspension order around:

• The CCI's power to revisit the 2019 approval.

• The power to examine the submissions made before other courts.

• The lack of due and fair procedure before the CCI suspended its earlier approval.

The ASG will continue his arguments before the appellate tribunal on Thursday.