Day before Amazon India’s magnum opus festive sale: The Great Indian Festival sale is about to begin, a group of sellers on their platform has revolved against them.
An official complaint has been filed with the Competition Commission of India, and things are looking murky as of now.
Is The Great Indian Festival Sale under threat now?
Keep reading to find out more!
Sellers: Amazo India Is Partial!
The All India Online Vendors Association (AIOVA) represents over 3500 online sellers, who are active on several online portals, including Amazon India.
In a major twist, they have written and complained to Competition Commission of India (CCI), against Amazon.
Since The Great Indian Festival is about to begin in a few days, this written complaint has created ripples all across the industry.
If they strike and refuse to ship items, then it can cause some major embarrassment to Amazon.
What Is The Issue Here?
Partiality seems the main issue here.
The members of the AIOVA are small-time sellers, who are somehow surviving in the cut-throat competitive world of online commerce.
However, it seems Amazon is giving them a raw deal.
As per the complaint, Amazon is giving preferential treatment to big sellers such as Cloudtail and Appario Retail.
Note here, that Cloudtail is owned by Amazon.com itself, and is a joint venture between and Infosys Founder N.R. Narayana Murthy’s Catamaran Ventures and Amazon Inc.
Amazon’s Partiality: The Modus Operandi
As per the complaint, Amazon India directly buys products in bulk from the manufacturers, and then sell the same to the big sellers in discount.
This way, they are able to provide large-scale discounts to the end-users, thereby prompting them to buy only from these sellers.
Hence, the big sellers are becoming even bigger, and the smaller sellers are left with peanuts.
The complaint stated, “AWIPL (Amazon Wholesale India Private Limited) will sell the goods to sellers like Rocket Commerce, Green Mobiles, Appario, Cloudtail etc. at a discount and will book the resultant loss in its books,”
Is This Even Legal?
As per the existing laws of FDI for online B2C marketplace, the large sellers (mainly Cloudtail on Amazon, and WS Retail on Flipkart) are not allowed to sell more than 25% of the overall volume.
We had even argued that if this rule of FDI is strictly imposed, then both Amazon and Flipkart won’t be able to offer such deep discounts which are promised during the festive day sales.
There has been no reply from Competition Commission of India on this matter, as of now.
We will keep you updated.
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