CCI weighs probe against quick commerce firms after complaints by traders’ body

To open a probe it will need to see if it can take a first impression view on the matter, which could then form the grounds for an investigation, according to two persons privy to the development. 

The anti-trust watchdog has started internal deliberations on a letter written by the All India Consumer Products Distributors Federation (AICPDF) expressing concerns over alleged preferential treatment and listing of certain sellers on these platforms and their alleged deep discounting practices.

Taking a prima facie view is the first step towards deciding on ordering a probe. A view will be taken on this soon, after more detailed deliberations, said one of the persons quoted above, who spoke on condition of not being named.

Queries emailed on Tuesday to CCI, Zepto and Swiggy, which houses Instamart on its platform, seeking comments for the story remained unanswered at the time of publishing. Zomato, which owns Blinkit, said it is not able to offer any comment at this moment. 

AICPDF National President Dhairyashil Patil told Mint that the body representing over 400,000 distributors and stockists across the country, has serious concerns about “the unchecked expansion of quick commerce platforms like Blinkit, Zepto, and Instamart.” 

Patil said the federation’s formal letter to the CCI was in light of “the increasing disruptions these platforms are causing to traditional retail.” The federation sought immediate investigation and regulatory action. 

“Our letter highlights critical issues such as predatory pricing, monopolistic strategies, and labour law violations that are threatening the livelihood of millions in the traditional retail sector.” Said Patil.

AICPDF is calling for a “balanced regulatory framework to ensure fair competition and protect the interests of small retailers, who form the backbone of the Indian economy,” said Patil. 

The trade body’s grievances follow the conclusion of a CCI investigation into alleged anti-competitive conduct of e-commerce platforms like Amazon and Flipkart. This matter is now sub-judice after some of the entities moved courts. 

Vivek Jalan, partner at Tax Connect Advisory Services LLP, a consulting firm, said that while business if needed, it cannot cause social disruption. 

The right to equality under Article 14 and the right to life under Article 21 of The Constitution strikes hard at any “arbitrary practices” in business, said Jalan.

“Having said this, India must always welcome e-commerce businesses which follow ethical practices as they are a huge employment generator and also help small and micro enterprises reach all corners of the country with their products, which otherwise they would not be able to reach,” said Jalan.

Earlier, the Central Consumer Protection Authority (CCPA) took suo moto cognisance of alleged violation of consumer rights by some e-commerce and quick commerce companies. 

Patil of AICPDF said the rapid growth of quick commerce should not come at the expense of traditional retail or ethical business practices. 

Siva Balakrishnan, CEO & Founder at Vserve, an e-commerce business solution firm, said, “The CCI’s investigation into anti-competitive practices within the quick commerce sector marks a crucial step towards creating a fair and balanced industry. 

As this rapidly evolving sector transforms consumer habits, it’s essential to ensure a level playing field and uphold both transparency and consumer interests. This scrutiny will encourage responsible practices and fair access, ultimately benefiting smaller players and building a healthier, more sustainable marketplace. We acknowledge and appreciate regulatory initiatives that drive innovation, protect consumers, and ensure businesses operate within a robust competitive framework.”

Gireesh.p@livemint.com