India’s National Company Law Appellate Tribunal (NCLAT) has asked the US-based retail behemoth Walmart and leading e-commerce player Flipkart to elaborate their business model of working in the country, following objections being raised by local traders.
NCLAT, which also happens to be Competition Commission of India’s (CCI) appellate authority has given Walmart International Holdings Inc. 20th September 2018, as a deadline to file an appropriate reply along with asking CAIT, who filed the case in NCLAT opposing the Walmart and Flipkart’s record US $ 16 billion deal to submit their understanding of Walmart’s way of working in the country.
Chairman Justice S. J. Mukhopadhaya, Head of the bench NCLAT handling the case affirmed media that, “Before going into the merit of the appeal, we wish to understand the manner in which Walmart Inc. and Flipkart Private Ltd. would do their business in the relevant market in India.”
Notably, last month, while clearing Walmart’s acquisition of Flipkart, the CCI observed that complaints about the deal violating FDI rules ‘May merit policy intervention’ but that did not fall in its range. The CCI issued a statement stating that the deal is not likely to have a considerable unfavourable effect on the competition in the Indian market and, therefore, the same deal is approved.
Recently, Walmart had announced that it has completed the transaction to own a 77 per cent stake in India’s home-grown e-commerce firm Flipkart along with an investment of US $ 2 billion of fresh equity funding to boost the e-retailer’s revenue.
Additionally, it is pertinent to add here that Walmart India is a subsidiary brand of Walmart Inc., which has a significant brick-and-mortar presence in India, it owns and runs over 20 Best Price Modern Wholesale outlets across 8 states in the nation.
