New CCI Rules Target E-Commerce, Q-Commerce: Flipkart, Blinkit for Predatory Pricing

In response to increasing concerns over predatory pricing strategies in India’s fast-growing digital retail space, the Competition Commission of India (CCI) has introduced a revised set of regulations. Effective from 7 May, the changes aim to address anti-competitive pricing tactics, especially in the e-commerce and quick commerce sectors, through an overhaul of existing cost norms first established in 2009. The move follows increasing scrutiny of ‘zero-pricing’ by Amazon, Flipkart, Zepto, and Blinkit.

Revised Cost Norms and Assessment Criteria

The newly implemented framework places average variable cost as the primary benchmark for identifying predatory pricing, providing greater clarity and consistency in the investigative process. However, recognising industry diversity and case complexities, the CCI has retained the discretion to apply alternative measures such as average total cost, average avoidable cost, or long-run average incremental cost when appropriate.

This overhaul addresses long-standing ambiguity in cost assessments used in anti-competitive pricing cases. The move is expected to bring more transparency and rigour to investigations involving pricing below cost, often seen as harmful to market competition.

Increased Oversight Amid Rising Complaints

The CCI’s new regulations arrive at a time when scrutiny of aggressive pricing tactics is intensifying. In March, the All India Consumer Products Distributors Federation lodged a formal complaint with the commission, seeking an inquiry into the pricing practices of major e-commerce and quick commerce platforms.

In addition to this case, platforms such as Zomato(ETERNAL) and Swiggy are already under investigation for alleged anti-competitive behaviour in their food delivery services. The updated norms also allow companies under investigation to challenge cost assessments by engaging independent experts at their own expense, ensuring a more balanced and fair regulatory process.

Following the CCI’s internal finding last year that e-commerce giants Amazon and Flipkart were violating competition laws by preferencing certain sellers, many sellers on these platforms filed petitions in High Courts nationwide to contest aspects of the CCI probe. The Supreme Court (SC) is currently hearing the case.

Read More: FMCG Distributors File Petition Against Quick Commerce Platforms

Conclusion

The implementation of the new regulatory framework by the Competition Commission of India marks a significant step towards monitoring and managing pricing strategies in the digital retail sector. With the digital economy continuing to grow, the updated cost norms reinforce CCI’s commitment to maintaining fair competition and addressing practices deemed predatory under the law.

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