The Competition Commission of India (CCI) said Amazon and its rival in the country, the Walmart-owned Flipkart, did not break regulations through their selection of merchants and brands. The decision is a defeat for a lobby group representing thousands of online sellers in the country.
A case brought by the All India Online Vendors Association (AIOVA), which represents more than 3,500 online sellers, complained that Flipkart was using its dominant position to favour select sellers - an argument the fair trade regulator rejected.
AIOVA's case alleged Flipkart was not adhering to a section of the country's anti-trust laws that says companies should not abuse a dominant market position through "unfair or discriminatory" pricing.
"Looking at the present market construct and structure of online marketplace platforms market in India, it does not appear that any one player in the market is commanding any dominant position at this stage of evolution of market," the CCI said in its ruling late on Tuesday.
The regulator added that its "considered opinion" was that Amazon has also not broken the rules.
AIOVA has also brought a similar case against Amazon, alleging it favours merchants that it partly owns, such as Cloudtail and Appario.
Chanakya Basa, a lawyer for AIOVA, said his client planned to appeal the decision.
"By their own admission Flipkart claims they are the dominant player," he said.
Flipkart and Amazon could not be immediately reached for comment. Amazon has previously denied the allegations against it.
The country's e-commerce market is tipped to grow to $200 billion in a decade, according to Morgan Stanley.
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