NCLAT asks CCI to probe Flipkart over vendors plea

After getting some respite from the competition watchdog in the Karnataka High Court recently, e-commerce companies now have something more to worry about. The National Company Law Appellate Tribunal (NCLAT) has asked the Competition Commission of India (CCI) to initiate a probe against Flipkart in a case filed by the All-India Online Vendors’ Association. (AIOVA)

The NCLAT on Wednesday set aside the order passed by the CCI and directed the director general to investigate the business practices of

Flipkart in an appeal filed by the AIOVA. The CCI in November 2018 had absolved Flipkart of alleged unfair business practices through abuse of its dominant position.

The AIOVA had alleged abuse of market dominance by Flipkart.

“We are delighted with today's order. We are positive after the e-commerce study findings that CCI will penalise these platforms for violating various provisions of the Competition Act,” said Chanakya Basa, counsel for AIOVA.

Reacting to the order, a Flipkart spokesperson said: "we understand that the NCLAT has issued an order in relation to the AIOVA appeal. We are currently awaiting a copy of the order".

Both Amazon and Flipkart had recently received a respite when Karnataka High Court had stayed a CCI probe against them. In that case filed by Delhi Vyapar Mahasangh against the ecommerce biggies, the HC had noted that CCI should have also called AIOVA in the matter before passing the impugned order.

With Corona virus playing havoc with domestic markets, regulators, including RBI and Sebi, are stepping in to salvage the situation.

The markets regulator Sebi said it is “internally assessing" the potential impact of the epidemic on the capital markets, even as the domestic equity market is witnessing huge volatility over the past week when the benchmark indices have fallen by over 7 per cent in line with the global meltdown.

"Sebi is aware of coronavirus and the possible impact that it can have on the market. We are taking the necessary steps," Sebi whole-time member S.K. Mohanty told reporters here.

"Whatever has to be done, has to be done. We are internally assessing situation," he added.

He, however, said the Financial Sector Development Council (FSDC), an apex body of regulators formed by the government, is yet to get involved in the discussions.

The comments come a day after remedial action by central banks across the world, including a surprise 50 basis points cut in rates by the US Federal Reserve. The Reserve Bank of India also came out with a statement on Tuesday, assuring the markets of all help. the

Market regulators and central banks across the global are taking measures to mitigate the risk of economies getting hit by the outbreak.

According to global brokerage firm, Credit Suisse, the impact on Asian economies from the coronavirus outbreak could be worse than SARS. “We expect a bigger and possibly longer macro impact for Asia than was seen during SARS. Our base case is that 12 months from now Asian economies will be near where it would have been without the Wuhan virus, but see a sizeable risk of a significantly worse outcome,” Credit Suisse said in a report.

The SARC epidemic had a big but short macro impact, with every Asian market except India, Indonesia and Japan seeing a significant fall.