USTR defends Amazon’s operations in India

United States Trade Representative (USTR) has defended Amazon’s business practices in India refuting Reuters’ allegations that the company flouts Indian rules for foreign e-commerce companies to favor certain sellers on its website. Citing a review by Competition Commission of India (CCI), USTR said, the investigating agency had found nothing wrong in Amazon’s operations in India.

Based on internal Amazon documents, the Reuters report in February accused the Amazon of giving preferential treatment to a small group of sellers on its India platform, circumventing the country's tough foreign investment rules that are aimed at protecting small Indian brick-and-mortar retailers.

The article stirred up weeks of controversy in India, sparking calls from traders to ban Amazon. The CCI said in March that the story corroborated evidence it had received against Amazon, while the Enforcement Directorate, India's financial-crime fighting agency, asked Amazon for information and documents related to the company's Indian operations.

But internal Amazon documents show that the e-commerce giant discounted its fees to certain sellers on its platform, and that a few dozen of Amazon's more than 400,000 sellers in early 2019 accounted for about two-thirds of the e-commerce site's online sales. In January 2020, CCI launched a probe into Amazon on allegations it was favoring certain sellers, but the investigation has been on hold as the company mounted a court challenge. A separate antitrust complaint by a group of online sellers filed against Amazon is currently pending review by the CCI.