Ground Report | New Delhi: Why Amazon has been fined; In a significant decision, the Competition Commission of India has suspended its approval to the deal between Future Coupons Pvt Ltd and Amazon, almost two years ago.
Apart from this, the Competition Commission has also imposed a fine of Rs 202 crore on Amazon for several violations. It is known that under the agreement between the two companies in August 2019, Amazon was to buy a 49% stake in Future Coupons Pvt Ltd. Futures Coupons account for 7.3% of futures retail through convertible warrants.
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In a 57-page order, the regulator said approval for the Amazon-Future Coupon Deal would be “suspended.” Citing some violations, the CCI said that they were “deliberately designed by Amazon to suppress the real scope and purpose of the merger” and that there was no way to reduce it.
As a result, Amazon has been fined a total of Rs 2 crore. The watchdog has also imposed a fine of Rs 200 crore for failing to notify the collection within the required conditions.
The parties involved in the merger were Amazon.com NV Investment Holdings LLC (Amazon) – a direct subsidiary of Amazon.com Inc – and Future Coupons.
An Amazon spokesman said in a statement: “We are reviewing the order passed by the Competition Commission of India and will decide on the next steps in due course.” When approving the agreement in November 2019, the CCI also stated that if at any time, the information provided by the recipient is found to be incorrect, the order will be canceled.
“This approval should in no way be construed as an exemption from proceedings before the Commission for violating other provisions of the (Competitive) Act,” he said.
In November 2019, the Competition Commission approved the deal. But at that time the Competition Commission had also mentioned that if at any time the information of the acquirer was found to be incorrect, then this order of approval would stand cancelled.