The All India Consumer Products Distributors Federation (AICPDF) has insisted that the Competition Commission of India (CCI) should investigate quick commerce platforms for charges of predatory pricing.
The quick commerce platforms that need to be investigated as per the retail group includes Swiggy Instamart, Blinkit and Zepto. This is as per a Reuters report. The retailer association told the commission that the quick commerce platforms were selling products at a lower price in order to lure customers.
The AICPDF which has more than 4 lakh distributors, highlighted that several consumer goods companies have decided to directly tie up with quick commerce firms. This in turn ends up sidelining the salespeople whose primary task is to go from one shop to another to sell the products, adds the letter.
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In its letter to the CCI, the AICPDF reportedly said, “Implement protective measures for traditional distributors and small retailers to safeguard their interests.” Meanwhile, a government officer told Reuters that if the CCI finds merit in the complaint, it has the power to initiate an investigation.
This comes at a time when the CCI in its earlier investigation reportedly found that e-commerce platforms Amazon and Flipkart were practicing anti-competitive practices. The commission also found that the two platforms preferred certain sellers and treated local sellers as mere bases bases. However, the Karnataka High Court paused the investigation in October this year. The procedure has been halted due to a procedural lapse on the part of the director general (DG), as per the Economic Times. The DG was investigating charges of foreign direct investment (FDI) violations by the two e-commerce giants.
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Increased Scrutiny on Quick Commerce Platforms
This development is happening at a time when there has been an increased scrutiny on quick commerce platforms. Concerns about quick commerce platforms were raised by the AICPDF earlier as well.
In September this year, the retailers body filed a complaint with the Commerce Ministry and the Department for Promotion of Industry and Internal Trade (DPIIT). In the complaint, the AICPDF highlighted that the quick commerce platforms where practicing unfair practices such as levying heavy discount on goods which in turn was harming competition.
The body also highlighted that these platforms where not in compliance with the foreign direct investment (FDI) rule of India, as per media reports. Following this, the DPIIT reportedly urged the CCI to investigate the quick commerce platforms. The quick commerce market has been growing exponentially in India with a market size of $2.8 billion.
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