The traders’ body had argued before the appellate tribunal that as a result of the “anti-competitive” transaction, Walmart would have effective control over the e-commerce platform.
The National Company Law Appellate Tribunal (NCLAT) on Thursday dismissed a petition filed by the Confederation of All India Traders (CAIT) against the Competition Commission of India’s (CCI’s) approval to global major Walmart’s $16-billion acquisition of a controlling 77% stake in e-commerce firm Flipkart.
The traders’ body had argued before the appellate tribunal that as a result of the “anti-competitive” transaction, Walmart would have effective control over the e-commerce platform. It would definitely sell its inventory on Flipkart’s platform or through a web of associated preferred sellers. It also alleged that though Walmart was involved in business-to-business (B2B) sales, evidences suggest that it was also present in business-to-consumer (B2C) sales.
Walmart objected to CAIT’s contention. It said the concern raised by the traders’ body was not specific to the transaction in question. CAIT has no locus standi to challenge the CCI order. Walmart said apprehension of overlap between the two are insignificant and thus, warrants no intervention.
“The Commission specifically and rightly came to a finding in absence of any evidence on record that the proposed combination is not resulting in elimination of any major player in the relevant market. The appellant (CAIT) has failed to show that any major player in the relevant market will be eliminated due to combination in question,” the two-member bench of the appellate tribunal headed by justice SJ Mukhopadhaya said.
After taking into consideration all relevant facts, including the objections raised by CAIT, the CCI had approved the deal on August 8, 2018. Walmart International Holdings, a subsidiary of Walmart, had signed a share purchase agreement with certain shareholders of Flipkart on May 9, 2018.
The NCLAT said Flipkart was also not impleaded as a party in the matter though the allegations were made against the company. “In such circumstances, no specific finding can be given against Flipkart in the present appeal. We find no merit in this appeal. It is accordingly dismissed,” the NCLAT bench said.