The Indian antitrust agency on Friday suspended Amazon’s 2019 transaction with Future Group, which may weaken the US e-commerce giant’s attempt to block the sale of Future’s retail assets to the Indian market leader.
The regulator ruled that the U.S. company had withheld information two years ago when seeking regulatory approval to invest in Indian retailer Future Group.
The ruling of the Competition Commission of India (CCI) may have a profound impact on the legal dispute between Amazon and its now separated partner Future. Amazon has successfully used the terms of its US$200 million (approximately 15 billion rupees) investment in Future for several months to prevent the Indian retailer from paying US$3.4 billion (approximately 25,950 crore) for the price in 2019 Sale of retail assets to Reliance Industries.
The regulator’s 57-page order stated that it believed it was “necessary to review the merger (transaction)” and added that its approval starting in 2019 “will be temporarily shelved”.
The CCI order stated that Amazon “suppressed the actual scope of the transaction” and made “false and incorrect statements” when seeking approval. “The approval was suspended. This is absolutely unprecedented,” said Shweta Dubey, a partner at an Indian law firm. SD Partners, former CCI official.
“The order seems to have found new powers for CCI to temporarily shelve the merger approval,” she added.
People familiar with the matter said that with the suspension of antitrust approvals for the Future deal in 2019, this may weaken Amazon’s legal status and retail ambitions, while making it easier for the country’s largest retailer, Reliance, to acquire Future, the second largest company.
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