MUMBAI: The Forum for Internet Retailers, Sellers & Traders (FIRST) has dragged Walmart-owned Flipkart Group to the Competition Commission of India (CCI), seeking a fresh investigation into the conduct of the company over practices designed to distort competition, benefit few preferred sellers and exclude scores of small retailers from the marketplace system.In its 157-page complaint to CCI, filed on July 2, FIRST alleged that Flipkart put in place a structural and operational mechanism to distort competition by facilitating and sustaining deep discounting across product categories at a marketplace-wide level. FIRST also alleged that the group generated a “self-replenishing reservoir of funds” estimated at about Rs 3,000 crore annually through the reduction or avoidance of GST liabilities related to its logistics and fulfilment operations, which it uses to sustain “exclusionary pricing conduct.” TOI has a copy of the complaint. FIRST is an affiliate of India SME Forum. Flipkart did not respond to any queries .
“This subsidy pool is deployed through the ecosystem of preferred sellers in the form of incentives, rebates and discounts….ultimately reflected in lower retail prices that independent sellers cannot match without sustaining significant losses or being driven out of business,” FIRST alleged. This spells fresh trouble for Flipkart, which is preparing for a public listing on the local bourses.