The Supreme Court of India has extended interim relief to Amazon and ordered that no recovery proceedings ordered by the CCI shall be initiated until the next date of hearing.
India's Supreme Court has ruled that no recovery proceedings ordered by the Competition Commission of India (CCI) shall be initiated until the next date of hearing i.e. September 20.
The top court’s direction comes on Amazon’s plea challenging the CCI's 2021 order that imposed a penalty of Rs 202 crore on the e-commerce giant for not disclosing its interest in Future Retail while investing in Future Coupons.
The order directed Amazon to pay the penalty amount by mid-February 2022. The penalties were imposed in two parts in accordance with separate sections of the law. Rs 200 crore and Rs 2 crore were thus imposed on Amazon.
Amazon filed the petition with the Supreme Court after the National Company Law Appellate Tribunal (NCLAT) backed the antitrust body's decision to defer its approval of Amazon's deal with the Future Group.
Earlier in May this year, the Supreme Court stayed the CCI order suspending approval for the e-commerce giant's 2019 deal investment in Future group and also the recovery of the penalty.
In December 2021, CCI suspended Amazon's 49 percent share acquisition clearance in Future Coupons Pvt Ltd (FCPL), the promoter of the Future Group.
Amazon was fined Rs 200 crore by the anti-trust tribunal for failing to disclose relevant and crucial information on its 2019 investment arrangement with FCPL.
As CCI pointed out, Amazon explained its interest in investing in Future's gift voucher unit as one that would address gaps in India's payments industry. But later, the CCI said, Amazon disclosed in other legal forums the foundation of its investment in the Future unit was to obtain special rights over the retail arm, Future Retail.
By investing in Future Coupons, Amazon hoped to disrupt the sale of Future Coupons' retail assets to rival Reliance for $3.4 billion. Amazon's investment was tied to contractual rights that include pre-emption rights and a non-compete pact — a prohibition on selling shares in the company to certain firms, which included Reliance. The online retailer has initiated arbitration proceedings in Singapore in this regard. The Singapore's Emergency Arbitrator ordered FRL which restrained it from going ahead with its deal with Reliance Retail.
Source: CNBCTV18
