- Thread starter
- Staff
- #1
Dadparvar
Staff member
- Nov 11, 2016
- 10,603
- 0
- 6
In an unprecedented move, the Competition Commission of India (CCI) Friday suspended the approval given for Amazon’s 2019 investment in Future Coupons Private Limited (FCPL), claiming that the US e-commerce giant concealed critical information while seeking regulatory clearance. It also levied a penalty of ₹202 crores on Amazon.
In November 2019, the CCI had permitted Amazon to acquire a 49 percent stake in FCPL, the promoter entity of Future Retail Limited (FRL), through a call option within 3-10 years. In August 2020, the Future Group signed an asset-sale deal with Reliance Industries Limited (RIL). Amazon objected to this deal and relied upon its investment in FCPL to get a stay on RIL’s deal from the Singapore International Arbitration Centre. Subsequently, the Indian Supreme Court also upheld the stay order’s validity. However, in its latest order, the CCI has said that Amazon deliberately “suppressed the actual purpose and particulars” of the 2019 deal.
The CCI said that Amazon had stated that the 2019 deal was motivated by FCPL’s business potential to build long-term value and offer a return on Amazon’s investment. However, Amazon’s internal correspondence revealed that the deal was envisaged for entirely different reasons. It further said that Amazon should have notified that the deal’s real purpose was to gain a foot-in-door in the Indian retail sector and “secure rights over FRL that are considered as strategic by Amazon and Commercial Arrangements between the retail business of Future Group and Amazon.”
Moreover, the also CCI stated that “Amazon had misled the Commission to believe, through false statements and material omissions, that the Combination and its purpose were the interest of Amazon in the business of FCPL.” In addition, the CCI said that the deal must be re-examined because it involves players who are well-known in the online and offline marketplace, and “they have contemplated strategic alignment between their businesses.” Consequently, it suspended its previous approval.
Given Amazon’s deliberate attempts to suppress the deal’s actual scope and its failure to comply with the Competition Act of 2002, the CCI also imposed a monetary penalty of ₹202 crores. It’s worth noting that the CCI’s decision could cause impediments in Amazon’s efforts to prevent RIL from acquiring Future Group’s retail assets.
The post India competition regulator suspends Amazon’s deal with Future Group appeared first on JURIST - News - Legal News & Commentary.
Continue reading...
Note: We don't have any responsibilities about this news. Its been posted here by Feed Reader and we had no controls and checking on it. And because News posted here will be deleted automatically after 21 days, threads are closed so that no one spend time to post and discuss here. You can always check the source and discuss in their site.
In November 2019, the CCI had permitted Amazon to acquire a 49 percent stake in FCPL, the promoter entity of Future Retail Limited (FRL), through a call option within 3-10 years. In August 2020, the Future Group signed an asset-sale deal with Reliance Industries Limited (RIL). Amazon objected to this deal and relied upon its investment in FCPL to get a stay on RIL’s deal from the Singapore International Arbitration Centre. Subsequently, the Indian Supreme Court also upheld the stay order’s validity. However, in its latest order, the CCI has said that Amazon deliberately “suppressed the actual purpose and particulars” of the 2019 deal.
The CCI said that Amazon had stated that the 2019 deal was motivated by FCPL’s business potential to build long-term value and offer a return on Amazon’s investment. However, Amazon’s internal correspondence revealed that the deal was envisaged for entirely different reasons. It further said that Amazon should have notified that the deal’s real purpose was to gain a foot-in-door in the Indian retail sector and “secure rights over FRL that are considered as strategic by Amazon and Commercial Arrangements between the retail business of Future Group and Amazon.”
Moreover, the also CCI stated that “Amazon had misled the Commission to believe, through false statements and material omissions, that the Combination and its purpose were the interest of Amazon in the business of FCPL.” In addition, the CCI said that the deal must be re-examined because it involves players who are well-known in the online and offline marketplace, and “they have contemplated strategic alignment between their businesses.” Consequently, it suspended its previous approval.
Given Amazon’s deliberate attempts to suppress the deal’s actual scope and its failure to comply with the Competition Act of 2002, the CCI also imposed a monetary penalty of ₹202 crores. It’s worth noting that the CCI’s decision could cause impediments in Amazon’s efforts to prevent RIL from acquiring Future Group’s retail assets.
The post India competition regulator suspends Amazon’s deal with Future Group appeared first on JURIST - News - Legal News & Commentary.
Continue reading...
Note: We don't have any responsibilities about this news. Its been posted here by Feed Reader and we had no controls and checking on it. And because News posted here will be deleted automatically after 21 days, threads are closed so that no one spend time to post and discuss here. You can always check the source and discuss in their site.