The Competition Commission of India (CCI) defended its move to order a probe against Amazon and Flipkart over anti-trust behaviour, which includes allegations of exclusive agreements with smartphone makers, stating that such agreements are often "tacit".

The competition watchdog on January 13, 2020, had ordered a probe against Amazon and Flipkart on alleged anti-competitive practices on a case filed by the Delhi Vyaar Mahasangh under Section 3 of Competition Act.

Section 3 of the Act deals with anti-competitive agreements, and the Delhi-based association had alleged that e-commerce giants were indulging in exclusive arrangements with smartphone makers, preferential treatment was given to certain sellers and were involved in deep discounting.

The CCI had then said that there was a prima facie case and asked the director general to investigate both the companies. The Karnataka High Court had last year granted an interim stay on the CCI order.

"If there are agreements where parties are trying to push out competition, we don't need to look at only formal agreements, there could also be a tacit understanding," CCI told the Karnataka High Court as it sought to lift the stay and go ahead with the probe.

"The definition of 'Agreement' has been kept wide because nobody who wishes to indulge in anti-competitive behaviour will spell it out," CCI's counsel Madhavi Divan said.

CCI also hit out at arguments by Amazon that CCI was overstepping jurisdiction since the Enforcement Directorate was already investigating them under the FDI policy. "Pendency of ED investigation is being used as a license to emasculate powers and duties of CCI," Divan said.

"A lot of time has been lost since last year since a party has resisted investigation under a legislation stating they are covered by FDI policy," she added.

CCI has argued that the probe is only to collect "collect solid, credible data", adding that it has become important for the agency to "preserve sanctity of the marketplace" as e-commerce has grown during the pandemic.

Amazon counsel Gopal Subramanian had argued that exclusive launches of mobile phones on the platform of brands such as Apple and Samsung take place for only a short while and that the products are available on the online stores of the smartphone brands as well during the time.

(Edited by : Jerome)