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Traders plan legal action against ecommerce players for ‘predatory pricing’

The issue would be considered and that the government was committed to a fair and healthy business environment in the country.

ET Bureau|
Updated: Oct 10, 2014, 03.26 AM IST
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The issue would be considered and that the government was committed to a fair and healthy business environment in the country. 
The issue would be considered and that the government was committed to a fair and healthy business environment in the country. 
NEW DELHI: Traders will move the Competition Commission of India (CCI) or the Supreme Court by the month-end against the ecommerce players over what they regard as predatory pricing, in case the government doesn’t act on it. The Confederation of All India Traders (CAIT) lobby group met commerce and industry minister Nirmala Sitharaman on Wednesday.

She assured them that the issue would be considered and that the government was committed to a fair and healthy business environment in the country. She said checks and balances are the basic fundamentals for the fair working of any sector. “We will very soon move CCI or the apex court. Our lawyer is working on it. We will wait another week or so for the government to act on the matter before deciding on filing a competition complaint by month end,” said Praveen Khandelwal, secretary general, CAIT.

Flipkart’s Big Billion Day sale on October 6 offered steep discounts on various products, and Amazon will follow with festive discount on October 10-16. This led to protests from brick and mortar retail who argued that such campaigns would hurt them. Khandelwal said it needed to be investigated whether the sellers are funded by the owners of the technology platform or if the manufacturers are giving products to online sellers at a different price than the offline market.

“In both cases, such practices are tantamount to predatory pricing, which contravenes the Competition Act,” he said. CAIT asked the minister to take steps to monitor and regulate online businesses. “We demand a regulatory body not only for e-commerce business but also for domestic trade of India,” said Khandelwal.

Sitharaman told the traders that the government will give due consideration to the formation of such a Board of Internal Trade. Flipkart has said that its Big Billion Day sale saw 1.5 million people shopping at its portal with sales worth $100 million. CAIT said that in the last six months there had been a business loss to the tune of 20-35% in offline sales on this count.
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