The National Company Law Appellate Tribunal (NCLAT) in India has upheld the order of the Competition Commission of India (CCI) to suspend approval of Amazon’s deal with Future Coupons.
In January this year, e-commerce giant Amazon moved the NCLAT against the CCI order to revoke an approval it had given two years earlier.
In 2019, the CCI approved Amazon’s deal to acquire a 49% stake in Future Coupons (FCPL) in a deal valued at Rs14bn ($179.4m).
Last December, however, the competition regulator suspended the approval on the grounds that Amazon had suppressed information while seeking clearances for the transaction.
The appellate tribunal upheld the CCI’s findings that Amazon had not made full disclosures.
An NCLAT bench comprising Justice M Venugopal and Ashok Kumar Mishra was quoted as saying: “The appellant Amazon has not made full, whole, forthright and frank disclosures of relevant materials.
“It had furnished only limited disclosures pertaining to acquiring its strategic rights and interest in FRL (Future Retail) and executing the commercial contract.
“In this regard, this appellate tribunal is in complete agreement with the view arrived at by the first respondent (CCI).”
In addition to rejecting Amazon’s plea, the NCLAT also asked the e-commerce retailer to pay a Rs2.02bn penalty within 45 days.
In August 2020, Reliance Retail Ventures (RRVL) agreed to buy parts of Future Group for Rs247.13bn.
This transaction was blocked legally by Amazon, citing the violation of non-compete contract terms.
The e-commerce giant alleged that RRVL had violated the terms of the contract by signing a deal with Indian conglomerate Reliance Industries (RIL).
In April this year, Reliance called off the deal after Future Group’s secured creditors rejected it.
In a ballot, 69% of the company’s secured lenders voted against the deal, while 86% of shareholders and 78% of unsecured creditors supported it.