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India’s antitrust authority halts Amazon’s 2019 deal with retailer Future

FILE PHOTO: Amazon's logo is pictured inside the company's office in Bengaluru
PHOTO FILE: REUTERS / Abhishek N. Chinnappa

December 17, 2021

By Aditya Kalra

NEW DELHI (Reuters) – India’s antitrust regulator on Friday suspended Amazon.com’s 2019 deal with Future Group, potentially thwarting the US company’s efforts to block asset sales retail of Future to a peer company in India.

The regulator has ruled that the US e-commerce group suppressed the information while seeking regulatory approval for its investment in Indian retailer Future Group two years ago.

The Competition Commission of India (CCI) ruling could have far-reaching consequences for Amazon’s legal battles with the now estranged partner in the future.

Amazon has for months successfully used the terms of a $200 million investment in Futures in 2019 to thwart an attempt by the Indian retailer to sell its retail assets to Reliance Industries for $3.4 billion.

The regulator’s 57-page order said it considered “a need to re-examine the (transaction) combination”, adding that approval from 2019 “will remain in effect” until then.

The CCI order said Amazon “prevented the actual scope” of the deal and made “false and inaccurate statements” while seeking approval. The CCI order imposed a penalty of about 2 billion rupees ($27 million) on the US company.

“The approval is suspended. This is completely unprecedented,” said Shweta Dubey, partner at Indian law firm SD Partners, who was previously a CCI official.

“This order appears to have found new strength for the CCI to maintain incorporation approval for the duration of its effect,” she added.

Amazon will have time to resubmit the information to seek approval, the CCI added.

Future and Reliance did not respond to requests for comment. Amazon said it was reviewing the order “and will decide next steps in due course.”

People familiar with the dispute said the pending 2019 Futures deal approval could undermine Amazon’s regulatory position and retail ambitions and help Reliance, the country’s largest retailer. – easier in future number two player acquisition.

Amazon has argued that terms agreed to in a 2019 deal that pays $200 million for a 49% stake in Future’s voucher unit prevented the parent company, Future Group, from selling the Future Retail Ltd business. to certain competitors, including Reliance.

But after Future complained to CCI that Amazon had concealed the facts, CCI in June sought an explanation from Amazon saying it had concealed factual aspects of the transaction by not disclosing strategic interests. its strategy towards Future Retail while seeking approval.

Amazon, in response to CCI, said it never hid important information, and warned the watchdog that revoking the deal would send a negative signal to foreign investors.

The Future-Reliance deal was delayed for months as Amazon received favorable interim rulings from Singapore arbitration and Indian courts.

Future denies any wrongdoing.

(Reporting by Aditya Kalra in New Delhi; Editing by Euan Rocha and Jane Merriman)

https://www.oann.com/indias-antitrust-body-suspends-amazons-2019-deal-with-future-citing-suppression-of-information/?utm_source=rss&utm_medium=rss&utm_campaign=indias-antitrust-body-suspends-amazons-2019-deal-with-future-citing-suppression-of-information India’s antitrust authority halts Amazon’s 2019 deal with retailer Future

Bobby Allyn

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