Amazon to delist top seller Appario on India marketplace amid regulatory heat • TechCrunch
Amazon plans to write off big seller Appario Retail, in which it holds a share, from the market, the two said Monday, a year later. Termination of relations with another big seller Cloudtail After allegations from retailers that some sellers received preferential treatment.
Amazon-owned Zodiac and Patni Group said in a statement that they have agreed to renew their joint venture, called Frontizo Business Services, but have decided Appario Retail will “stop being a seller” in Amazon India within the next 12 months.
“Partners will continue to explore new business opportunities, including helping businesses across India expand their online presence,” a spokesperson for Amazon India told TechCrunch in a statement.
Amazon did not say why it was delisting Appario, but the move comes after increased scrutiny of its owned sellers. India’s anti-monopoly watchdog launched raids on Apario and Cloudtel earlier this year after accusations of violating competition law, Reuters mentioned in April.
A Reuters investigation last year showed that Amazon was Give preferential treatment for years to a small group of sellers on its platform and used them to bypass Indian laws. The outlet’s investigation also showed that Amazon has been helping these sellers for years with reduced fees.
The investigation found that about 35 of the 400,000 Amazon sellers in India in 2019 accounted for about two-thirds of sales on its website in India. Of that number, two vendors, Cloudtel and Apario, contributed 35% of the platform’s sales.
India’s Supreme Court ruled last year that Amazon and Walmart-owned Flipkart should face antitrust investigations ordered against them in the country.
India’s watchdog – the Competition Commission of India – has ordered an investigation into companies in 2020 for allegedly promoting select sellers (those with a stake in them) on their e-commerce platforms and using business practices that stifle competition.
Laws in India restrict Amazon and other e-commerce companies from holding inventory or selling items directly to consumers. To get past this, companies worked through a maze of joint ventures with local businesses that act as inventory firms.
India got around Fix this vulnerability in late 2018 In a move that was widely seen as the biggest US company backlash in the country at the time. Amazon and Walmart-owned Flipkart rushed to Delete hundreds of thousands of items from their stores and made their investment in affiliates indirectly.
in stinging report in AugustIndia’s The Economic Times has found that a group of new sellers run by former Cloudtail and Appario executives have mushroomed in the country and are listed on Amazon’s marketplace.
India is a major overseas market for Amazon, having invested more than $6.5 billion in the South Asian market. But it still lags behind its main competitor Flipkart in the country on several measures and it is Struggling to make headway in India’s smaller cities and townsaccording to a report by investment firm Sanford C. Bernstein.