1. Home
  2. Business
  3. CCI suspends Amazon-Future 2019 deal, imposes ₹200-crore fine on Amazon: Report

CCI suspends Amazon-Future 2019 deal, imposes ₹200-crore fine on Amazon: Report

By Priyanka Verma 
Updated Date

India’s antitrust body competition commission of India (CCI) on Friday said Amazon’s 2019 deal with Future to remain in abeyance, citing US e-commerce major’s failure to notify certain commercial arrangements as part of 2019 deal.The competition watchdog has also imposed ₹200 crore penalty on Amazon.

Also Read :- Byju's second massive layoffs; Fires over 1,000 employees as it is grappling with slower revenue growth

The unprecedented step taken by CCI could have far-reaching consequences on Amazon’s legal battles with now estranged partner Future. The US firm has for months successfully used the terms of its toehold $200 million investment in 2019 to block Future’s attempt to sell retail assets to Reliance Industries for $3.4 billion.

All disclosures contraventions arise from a deliberate design by amazon to suppress scope of 2019 Future deal, CCI said.Amazon suppressed the actual purpose and particulars of 2019 deal, the watchdog further stated.

In a 57-page order, the CCI said it considers “it necessary to examine the combination (deal) afresh,” adding its approval from 2019 “shall remain in abeyance” until then.

Amazon had “suppressed the actual scope” of the deal and had made “false and incorrect statements” while seeking approvals, the CCI order added.

Also Read :- Calicut-bound Air India Express flight catches fire in engine, returns to Abu Dhabi. All passengers safe

“The approval is suspended. This is absolutely unprecedented,” said Shweta Dubey, a partner at Indian law firm SD Partners, who was formerly a CCI official.”The order seems to have found new power for CCI to keep the combination approval in abeyance,” she added.

Amazon will be given time to submit information again to seek approvals, the CCI added.Future and Reliance did not respond to a request for comment. Amazon said it is reviewing the order “and will decide on next steps in due course.”

The 2019 Future deal approval being put on hold could dent Amazon’s legal position and retail ambitions, while making it easier for Reliance – the country’s largest retailer – to acquire number two player Future, people familiar with the dispute said.

Amazon has argued that terms agreed in its 2019 deal to pay $200 million for a 49% stake in Future’s gift voucher unit prevent parent, Future Group, from selling its Future Retail Ltd business to certain rivals, including Reliance.

Amazon, in responses to CCI reported by Reuters this week, said it never concealed material information, warning the watchdog that the deal’s revocation would send a negative signal to foreign investors.

Also Read :- Amul raises milk prices by ₹3 Per Litre from today: check new rates

The Future-Reliance deal has been on hold for months as Amazon got favourable interim rulings from a Singapore arbitrator and Indian courts.

For the latest news and reviews, follow us on Facebook, YouTube and Twitter पर फॉलो करे...