The Competition Commission of India (CCI) on Friday suspended Amazon’s 2019 deal with Future Group, a unit of Future Retail Ltd. The antitrust watchdog also imposed a penalty of Rs 200 crore on the US retail giant for concealing information while seeking nod from CCI.
CCI had mentioned in its order, “it necessary to examine the combination (deal) afresh.” “In exercise of the powers conferred under sub-section (2) of Section 45 of the Act, the Commission hereby directs Amazon to give notice in Form II within a period of 60 days from the receipt of this order, and, till disposal of such notice, the approval granted vide Order dated 28th November, 2019, in Combination Registration No. C-2019/09/688, shall remain in abeyance,” the CCI order read.
“Amazon had suppressed the actual scope of the Combination and had made
false and incorrect statements in relation to the BCAs, which are intertwined into the scope and purpose of the Combination,” CCI further mentioned in its 57-page order.
On November 16, the Delhi High Court had directed the Competition Commission of India (CCI) to rule on revoking its approval to the Amazon-Future Coupons deal within two weeks. The Confederation of All India Traders (CAIT) had earlier filed a PIL against CCI that the regulator had issued a show-cause notice to Amazon in June, but has not taken a decision yet.
Independent directors of Future Retail Ltd also wrote a letter to CCI in the past seeking revocation of the nod given to the US giant’s 2019 investments into Future Coupons. They accused Amazon of submitting “completely opposite information” while seeking approval from CCI . “Amazon has concealed facts, made misrepresentations and false representations to the Commission,” the letter alleged.
Amazon had “not disclosed its strategic interest over FRL” while getting approval from the CCI to prevent it from referring the transaction to other governmental agencies that “would have responded that the transaction is illegal”, according to the letter.
The approval given by the Commission does not hold good due to the concealment and misrepresentation and false representations made by Amazon, as per the seven-page letter written to CCI Chairman Ashok Kumar Gupta, PTI reported.
Future retail independent directors have also requested CCI to stop Amazon from “perpetuating its evil non-desirable designs” to make FRL bankrupt and jeopardise Rs 30,000 crore of debt extended by public sector banks to Future group.
In November 2019, CCI had given its approval for Amazon to acquire a 49 per cent stake in Future Coupon.
The CCI had reviewed a complaint from Future Group and then accused Amazon of concealing facts while seeking approval to invest in a Future Group unit in 2019, after the watchdog compared legal disclosures made by Amazon at several forums.
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