DPIIT urges CCI to investigate quick commerce platforms amid retailer complaints: Reports

Local retailers allege that quick delivery services are engaging in unfair practices, a concern that the DPIIT has brought to the CCI's attention.

The Department for Promotion of Industry and Internal Trade (DPIIT) has requested the Competition Commission of India (CCI) to investigate quick commerce platforms, including Blinkit and Zepto, following complaints from local retailers about anti-competitive practices, as reported by Mint. This move comes in the wake of Commerce Minister Piyush Goyal’s warning regarding the social disruption caused by e-commerce platforms and the risks posed by predatory pricing, a strategy where companies lower prices to capture market share before subsequently raising them.

Local retailers allege that quick delivery services are engaging in unfair practices, a concern that the DPIIT has brought to the CCI's attention. The DPIIT argues that while discounts may benefit consumers, they can harm smaller businesses that cannot compete on price, potentially leading to higher prices once competition diminishes.

Although the CCI does not directly regulate prices, it is tasked with ensuring fair competition within the market. Queries sent to the DPIIT secretary, CCI chairman, and the commerce ministry spokesperson by Mint went unanswered; Moneycontrol could not independently verify the report.

An unnamed source revealed that the DPIIT's letter to the CCI chairman outlines complaints against quick commerce companies for employing anti-competitive marketing strategies. The letter highlights allegations that these firms are signing exclusive agreements with certain suppliers, giving specific vendors an unfair advantage and enabling them to dominate the market.

India’s e-commerce sector is projected to grow to $325 billion by 2030, fueled by the nation’s 881 million internet users. Currently valued at $70 billion, e-commerce constitutes approximately 7 percent of India’s retail market, according to Invest India.

Additionally, the CCI’s Director General of Investigation has reported that Amazon Seller Services Pvt. Ltd. and Flipkart Internet Pvt. Ltd. have allegedly breached competition laws by favoring certain sellers, launching exclusive products, and offering significant discounts. Both companies are currently involved in proceedings with the CCI, as noted by Mint on September 12.