US officials rushed to defend Amazon’s small business practices in India right after Reuters reported in February that the corporation had favored particular sellers on its web site and bypassed regional law that needs foreign e-commerce firms to treat all vendors equally, documents obtained by the news agency show.
Emails obtained by way of the US Freedom of Information Act from the Office of the United States Trade Representative (USTR) showed that US officials ready a note for John Kerry, a leading envoy of President Joe Biden, about the Feb. 17 Reuters report. The note, contained in an e mail dated Feb. 18, mentioned that India’s antitrust watchdog had reviewed quite a few such allegations against US e-commerce firms and located absolutely nothing incorrect.
Biden’s envoy, former US Secretary of State Kerry, is in charge of climate alter policy. He was scheduled to speak that day with Commerce Minister Piyush Goyal. The US government was concerned that Goyal would bring up the Reuters story, so it hastily drafted a note about the report in case he did, the emails show.
“This could come up in the call since as you know Minister Goyal is prone to bring up tangential topics,” Thomas Carnegie, a US embassy official in New Delhi, emailed an official at the USTR.
Philip M. Ingeneri, an additional US embassy official, also told the USTR official in an e mail on Feb. 18 that he had “verified” the contents of the note ready for Kerry with Amazon India’s government affairs chief as “true and accurate.” The emails do not describe what eventually occurred for the duration of the Kerry-Goyal get in touch with.
The US embassy in New Delhi referred inquiries to the US Department of State in Washington, which mentioned it anticipated that any concerns relating to US e-commerce companies’ practices in India would be reviewed by the Competition Commission of India (CCI) “with the same level of independence, transparency, and professionalism it has demonstrated in the past.”
Spokespeople for Kerry, the USTR and Mr Goyal did not respond to Reuters queries.
The Reuters report in February, based on internal Amazon documents, revealed that the US firm has for years provided preferential remedy to a compact group of sellers on its India platform, circumventing the country’s difficult foreign investment guidelines that are aimed at safeguarding compact Indian brick-and-mortar retailers.
The report stirred up weeks of controversy in India, sparking calls from traders to ban Amazon. The CCI mentioned in March that the story corroborated proof it had received against Amazon, though the Enforcement Directorate, India’s economic-crime fighting agency, asked Amazon for details and documents associated to the company’s Indian operations, Reuters has reported. The CCI enforces India’s antitrust laws.
‘SENSATIONALIST LANGUAGE’
In a March 16 e mail to U.S. officials, like at the USTR’s workplace, Ingeneri wrote, in an apparent reference to the February report, that a Reuters reporter had utilised “sensationalist language” and relied on Amazon’s “activity before 2018 that was aggressive but not illegal at the time.” The next sentence in the e mail was redacted.
In response to inquiries from Reuters, a spokeswoman for Amazon in India mentioned the corporation had no comment.
Amazon has previously told Reuters it “does not give preferential treatment to any seller on its marketplace,” and that it “treats all sellers in a fair, transparent, and non-discriminatory manner.”
But internal Amazon documents show that the e-commerce giant discounted its costs to particular sellers on its platform, and that a couple of dozen of Amazon’s more than 400,000 sellers in early 2019 accounted for about two-thirds of the e-commerce site’s on line sales.
The note ready for Kerry summarized the Reuters story’s findings. Among them: that Amazon senior executive Jay Carney had been advised by colleagues in 2019 not to disclose to India’s ambassador in Washington that two sellers on Amazon’s Indian web site accounted for a substantial chunk of its sales. Amazon holds indirect equity stakes in these sellers.
From 2009 to 2011, Carney served as President Biden’s communications director when Biden was vice president, prior to going on to serve as press secretary to President Barack Obama. The note for Kerry identified Carney as “Amazon Senior Vice President and former Obama Administration spokesman.”
Carney had no comment for this report, the Amazon spokeswoman mentioned.
Under the headline “If Asked: Allegations of Amazon E-Commerce Violations,” the note stated: “We have seen a February 17 Reuters report raising concerns about US e-commerce companies’ practices in India and note many of the allegations have been previously reviewed by the Competition Commission of India without any negative findings.” The e mail with the note was marked “SENSITIVE BUT UNCLASSIFIED.”
“The Reuters article repeated prior allegations made by small traders,” the note stated. The partially redacted note also stated that “since 2013, Amazon has invested over $5.5 billion in India, employs 100,000 Indians, and supports 400,000 vendors on its market.”
India’s strict foreign investment guidelines for e-commerce have triggered friction among Washington and New Delhi, and frustrated US firms with on line companies in India, such as Amazon and Walmart Inc.
The CCI in January 2020 launched a probe into Amazon on allegations it was favoring particular sellers, but the investigation has been on hold as the corporation mounted a court challenge. A separate antitrust complaint by a group of on line sellers filed against Amazon is presently pending critique by the CCI.
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