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ED raids Amazon, Flipkart sellers’ offices for allegedly flouting foreign investment rules
- IBJ Bureau
- Nov 08, 2024
The Enforcement Directorate (ED) has conducted raids on sellers associated with Amazon and Walmart-owned Flipkart, targeting alleged violations of the country’s foreign investment rules.
Reportedly, the pan-India operation included searches at sellers’ locations and Amazon and Flipkart subsidiaries across major cities, like Delhi, Mumbai, Hyderabad and Bengaluru.
“The raids on sellers of Amazon and Flipkart is (sic) a part of ED’s probe ... for alleged violations of foreign exchange laws,” the Reuters has quoted a source in the government saying.
This latest probe follows findings from the country’s antitrust body, which has concluded that both Amazon and Flipkart, along with some of their sellers, have violated competition laws by favouring specific sellers.
The companies have consistently claimed adherence to Indian regulations, but the ED is now examining if any violations of the Prevention of Money Laundering Act (PMLA) have occurred through transactions on these platforms.
One senior official disclosed that the raids are a part of an ongoing investigation into possible foreign exchange law breaches. The ED is especially focused on how these e-commerce platforms may influence product prices indirectly, potentially giving preferred sellers an unfair advantage and creating an uneven playing field.
Sources have reported that the raids have spanned 19 locations in India, but no specific sellers’ names have been disclosed.
Both Amazon and Flipkart have yet to respond to requests for comment.
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