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  1. E-commerce: Resale price pacts in online retail space under probe, says CCI

E-commerce: Resale price pacts in online retail space under probe, says CCI

Keeping a close watch on the growing e-commerce market, fair trade regulator CCI is probing whether certain resale price arrangements between manufacturers and e-retailers violate competition norms.

By: | New Delhi | Published: August 12, 2015 6:33 PM
Ecommerce firms Flipkart

Recently, the Commission rejected allegations of unfair business practices against five online retailers — Flipkart, Snapdeal, Amazon, Jabong and Myntra. (Illustration: Shyam)

Keeping a close watch on the growing e-commerce market, fair trade regulator Competition Commission of India (CCI) is probing whether certain resale price arrangements between manufacturers and e-retailers violate competition norms.

The CCI has been looking into various instances involving e-commerce and high technology products, including issues related to enforcement of patent rights.

Recently, the watchdog had rejected allegations of anti-competitive practices against leading online retailers after finding no prima-facie evidence of violations.

CCI Chairman Ashok Chawla said the regulator is currently investigating a matter related to resale price maintenance.

“It is a case of an allegation where a kitchen appliance maker has stipulated that the trader, in this case the online trader, will not sell the product below a certain price.

“Putting a floor (price) is also anti-competitive. Why put a floor? If you can sell below that, it is good. That is under investigation,” Chawla told PTI in an interview.

By way of resale price maintenance practices, which is quite common in consumer goods and some other sectors, a manufacturer and distributor decide that the former’s product would not be sold at a price below a certain threshold level.

This is the latest in a series of cases being probed by CCI with regard to the fast-growing online retail space.

Recently, the Commission rejected allegations of unfair business practices against five online retailers — Flipkart, Snapdeal, Amazon, Jabong and Myntra.

The complaints were filed against Flipkart India Pvt Ltd, Jasper Infotech Pvt Ltd, Xerion Retail Pvt Ltd, Amazon Seller Services Pvt Ltd and Vector E-commerce Pvt Ltd.

Jasper runs Snapdeal.Com, Xerion owns Jabong.Com, while Vector is the company behind Myntra.Com. Myntra has been acquired by Flipkart.Com.

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Tags: E Commerce

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