US e-commerce giant Amazon has gotten involved in a new controversy after reports of bribery allegations against Amazon’s Indian legal representatives surfaced on Monday, 20 September.
After the reports surfaces, the e-commerce giant asserted that it takes allegations of improper conduct seriously and probes them judiciously to take corrective action.
However, the Centre might not wait for Amazon’s internal investigation to complete and could order its own enquiry into the allegations, government sources were quoted by Times of India.
WHAT ARE THE ALLEGATIONS
A report by The Morning Context stated that Amazon has undertaken a probe against some of its legal representatives who allegedly bribed Indian government officials, , adding that the American giant's senior corporate panel has also been sent on leave in this matter.
According to sources quoted by news agency PTI, six entities of Amazon paid Rs 3,420 crore in India during 2018-19 and Rs 5,126 crore during 2019-20 towards legal fees, a claim which Amazon has denied.
Meanwhile, the Confederation Of All India Traders (CAIT) National Secretary General Praveen Khandelwal wrote to Commerce Minister Piyush Goyal saying, "The whopping amount spent under legal professional fees clearly shows how Amazon and its subsidiaries are misusing their financial muscles to bribe and manipulate Indian government officials."
Though there is no proof for the claim, Khandelwal has demanded a Central Bureau of Investigation (CBI) inquiry.
WHAT AMAZON HAS SAID:
On Monday, Amazon had said, "We have zero tolerance for corruption. We take allegations of improper actions seriously, investigate them fully, and take appropriate action."
Later on Wednesday, 22 September, Amazon denied reports which claimed Amazon to have spent around Rs 8,500 crore as legal fees over the past few years.
“Given a misleading representation of a line item from a statutory filings on legal fees in a section of the media, we clarify that the line item is actually termed legal and professional expenses that includes not just the legal costs but also the costs related to other professional servies such as outsourcing, customer research, logistic support services, merchant onboarding services, customer service cost, etc. For instance, for the year ended March 2020, the legal fee was Rs 52 crore”, Times of India reported.
Amazon is also facing an enquiry by the Competition Commission of India (CCI) over alleged anti-competitive practices, predatory pricing and preferential treatment of sellers.
Amazon is also locked in a legal tussle with the Future Group over their agreement with Reliance Retail to sell its retail, wholesale, logistics, and warehouse businesses to Reliance Retail Ventures.
Amazon had legally refuted the deal, alleging that the deal breached some of Amazon’s pre-existing contracts with Future Group, and took the Future Group to arbitration at Singapore International Arbitration Centre (SIAC) in October 2020.
Adding to Amazon's relief, the Supreme Court had pronounced its verdict in favour of the e-commerce company, and upheld Singapore's Emergency Arbitrator (EA) award, which restrained the Rs 24,731 crore deal between Reliance Retail and Future Retail Ltd.
(With inputs from The Times of India and PTI)
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