India’s Competition Commission of India (CCI) has accused smartphone giants Samsung and Xiaomi of colluding with e-commerce platforms Amazon and Flipkart to conduct exclusive online product launches, in violation of antitrust laws. These practices, the CCI states, have hurt smaller retailers across the country, raising concerns over free competition.

Regulatory Scrutiny Deepens

According to reports by Reuters, the CCI’s investigation uncovered how smartphone manufacturers, including Xiaomi, Samsung, Realme, and others, worked hand-in-hand with Amazon and Walmart-owned Flipkart to favor certain sellers, steeply discount products, and prioritize listings on their platforms. This behavior, described by the CCI as rampant, goes against India’s fair competition principles. The investigation was initiated following complaints from the Confederation of All India Traders, representing over 80 million small retailers.

Impact on India’s Retail Sector

India’s retail market, both online and offline, has been significantly impacted by these practices. Smaller Indian retailers have long complained that exclusive online product launches deprive them of access to the latest smartphone models. With 50% of phone sales taking place online in 2023, the dominance of Amazon and Flipkart, along with their preferred smartphone partners, has intensified these concerns. Brick-and-mortar retailers, who often receive products much later than their online counterparts, have seen significant losses.

Major Setback for E-commerce Giants

The findings of the CCI come at a critical juncture for Amazon and Flipkart, both of whom rely heavily on the Indian market for growth. As they face mounting legal challenges, the investigation could lead to fines and forced changes in their business practices. The investigation also demands that Samsung, Xiaomi, and other smartphone companies submit detailed financial records to the CCI, further complicating their operations in India.

For more details on the investigation, check out the full article here.