Lambasting the anti-competitive practices of e-commerce companies like Amazon and Flipkart, Commerce and Industry Minister Piyush Goyal said instead of forum shopping, they should let the Competition Commission of India (CCI) investigate if they were doing honest business, adding that the reluctance showed they weren't doing it right.
"...when questioned about it they keep fobbing off, delaying giving you the information and when people complained to the Competition Commission of India, they immediately started forum shopping. Trying to go to one court, lose in that court, go to another court .. to my mind if they have nothing to hide if they are doing honest business practices why don't they respond to the Competition Commission of India?" he said at a webinar.
"The fact that they are trying to evade that only justifies that they are probably indulging in predatory prices, trying to influence market behaviour. Their algorithms are trying to influence consumer choice and these are not permitted in India. They should have submitted to the requirements of the Indian laws," he added.
Goyal's comments come at a very crucial time when the division bench of the Karnataka High Court is expected to pronounce its judgement on whether CCI can investigate the two companies or not.
The division bench consisting of Justice Satish Chandra Sharma and Justice Nataraj Rangaswamy concluded hearing the arguments presented by Amazon, Flipkart, CCI and other parties, reserving its judgement on June 25.
CCI investigation against the two companies has been contested for a long time now.
The issue is 18 months old when the Delhi Vyapar Mahasangh (DVM), a group representing small and medium business owners in the national capital, submitted a plea with CCI against the country's two biggest e-commerce players, accusing them of anti-competitive practices, predatory pricing and preferential treatment of sellers among others.
The Karnataka High Court had given its judgement in favour of CCI on June 11. However, Flipkart and Amazon soon challenged that judgement which was pronounced by Justice PS Dinesh Kumar in the division bench of the High Court.
Making no attempts to mince words during the webinar, Goyal also said that "many of these large e-commerce companies" have come into India and were blatantly flouting the laws of the land, in more ways than one.
Giving the example of practices adopted by other countries, he said that currently, even the US was working on anti-trust laws for e-commerce while the UK's competition watchdog Competition and Markets Authority had started an investigation into US-based companies.
"Clearly the world is waking up to the reality of these large tech and big e-commerce companies. In America today the mom-and-pop stores are history. You will not find too many of them in the whole country," he said.
India on the other hand has over 60 million mom-and-pop stores across the country which also constitute a big chunk of the vote bank of the ruling Bharatiya Janata Party.
In order to tighten the rope for many of these companies, on June 22 the government also issued a draft Consumer Protection (E-Commerce) Rules, 2020 which aims to change the landscape of how e-commerce companies have been doing businesses in India.
Trying to bring closure to the constant allegations of preference given to a select set of vendors by the e-commerce companies, the government is trying to ensure that no logistics service provider of a marketplace e-commerce entity shall provide differentiated treatment between sellers of the same category through these rules.
The government has also said that the e-commerce companies will have to ensure that none of its related parties are listed as sellers for sale to consumers directly. The companies have been categorically told that they will have to ensure that nothing is done by related parties which they themselves are prohibited to do.
The government is trying to address the burning issues of preferred vendors and online discounting which have marred the growth of offline retailers in India.
The government has sought views from stakeholders by July 6.