India Cracks Down on E-commerce Giants: Amazon and Flipkart Under Investigation

India's Enforcement Directorate has raided offices of sellers on Amazon and Flipkart platforms, probing alleged violations of foreign investment rules. This move follows reports of competition law breaches. Both companies assert adherence to Indian laws, but face scrutiny over their seller relationships.

In a significant move, India's Enforcement Directorate has conducted raids on sellers linked to major e-commerce platforms Amazon and Flipkart. The searches are part of an investigation into alleged foreign investment law violations, according to two government sources on Thursday.

This development follows reports indicating that the companies and their sellers have breached competition laws, favoring select vendors. Both Amazon and Flipkart, however, maintain their compliance with national regulations.

An ongoing probe is addressing concerns that these platforms, which are prohibited by Indian law from holding product inventories, might be manipulating the market by favoring specific sellers.

(With inputs from agencies.)