Key Points
- Samsung, Xiaomi, and others have been accused of colluding with Amazon and Flipkart to launch exclusive products.
- CCI report finds preferential treatment and discounting by e-commerce platforms harmed competition.
- Smartphone makers face legal challenges; online sales dominate India’s mobile phone market.
- As CCI reviews objections, potential consequences of fines and mandated business practice changes may follow.
According to India’s Competition Commission (CCI) findings, Samsung, Xiaomi, and other smartphone manufacturers are accused of colluding with Amazon and Walmart-owned Flipkart to launch products exclusively on their Indian e-commerce platforms, violating antitrust laws.
The investigation reports span over 1,000 pages each, covering Amazon and Flipkart. They reveal that these platforms gave preferential treatment to select sellers, offered deep discounts, and prioritized specific product listings, leading to unfair competition.
The August 9 CCI report on Amazon highlights how the Indian subsidiaries of Samsung, Xiaomi, Motorola, Realme, and OnePlus engaged in these exclusive phone launches. A similar 1,696-page report for Flipkart listed Samsung, Xiaomi, Motorola, Vivo, Lenovo, and Realme as participants in these practices.
Major smartphone companies like Samsung and Xiaomi have added to the legal challenges in India. CCI officials criticized these practices, stating that exclusivity in business undermines free competition and harms consumers. This marks the first time smartphone manufacturers have been directly implicated in anti-competitive behavior within CCI’s reports.
Although Amazon, Flipkart, and the smartphone companies have not responded to these accusations, the investigation has shed light on how these platforms and manufacturers “deliberately downplayed” the practice of exclusive launches despite evidence showing it was widespread.
India’s smartphone market, dominated by Samsung and Xiaomi with a combined 36% share, has seen a significant rise in online sales. In 2023, Flipkart held 55% of online phone sales, while Amazon captured 35%. The country’s e-retail market is projected to grow to $160 billion by 2028, making this a crucial market for these companies.
As the CCI moves forward, Amazon, Flipkart, and smartphone makers may required to submit financial documents. Potential fines and mandatory changes in business practices could follow as the regulator prepares to review the parties’ objections.
