CCI Accuses Samsung, Xiaomi Of Violating Competition Laws By Colluding With Amazon & Flipkart For Exclusive Launches

CCI's report on Amazon said that Indian units of Samsung, Xiaomi, Motorola, Realme, and OnePlus were "involved in the practice of exclusive" phone launches in collusion with the e-commerce brand.

The antitrust body of India, the Competition Commission of India, has noted that Samsung, Xiaomi, and other brands have colluded with Amazon and Flipkart to launch products exclusively on e-commerce websites. According to antitrust reports seen by Reuters, CCI has found out that both e-commerce companies violated local competition laws by giving preference to some select sellers.

These websites have been accused of prioritising certain listings, and then offering massive discounts that eventually affected other companies negatively. 

What Does CCI Say

The 1,027 page report of CCI on Amazon stated that the Indian units of five companies Samsung, Xiaomi, Motorola, Realme, and OnePlus were "involved in the practice of exclusive" phone launches in "collusion" with Amazon and its affiliates, which resulted in the violation of competition law. According to CCI's 1,696 page report on Flipkart, Indian units of Samsung, Xiaomi, Motorola, Vivo, Lenovo, and Realme were also engaged in similar practices.  

Reuters quoted CCI's additional director general GV Siva Prasad in both the reports wrote, "Exclusivity in business is anathema. Not only is it against free and fair competition but also against the interest of consumers."

According to both reports, Amazon and Flipkart have deliberately downplayed the accusations of exclusive launches but contrary to this, CCI officials noted that the practice was "rampant."

According to Counterpoint Research, Samsung from South Korea and China's Xiaomi are leading players in India's smartphone market, with a combined market share of nearly 36 per cent, while Vivo holds 19 per cent. Bain & Co. predicts India's e-commerce market will grow to over $160 billion by 2028, up from $57-60 billion in 2023.

The recent investigation results present a major setback for Amazon and Flipkart in this key growth market, where they've long been criticized by small retailers for harming offline businesses. The CCI also accused both companies of using foreign investments to offer discounted services like warehousing and marketing to a select few sellers.