FPBAI Questions The Predatory Pricing Tactics Of E-Commerce Websites Of India

FPBAI Questions The Predatory Pricing Tactics Of E-Commerce Websites Of IndiaThe books publication industry of India is passing through a crucial and highly competitive phase. The growing popularity of e-books and sale of paper books at e-commerce websites have changed the way books were published, distributed and sold in India so far.

In the international market, regulations of and litigation in the field of books publication and e-books are fast increasing. For instance, Apple was fined in Beijing court for unauthorised e-books sale. Similarly, publishers entered into a settlement with European Union for e-books price fixation. The Penguin Group also settled an e-book price escalation lawsuit recently.

Back in India, the books distribution and wholesale channels have been severely hit by the burgeoning e-commerce business of India. While healthy competition is always welcome and is good or the consumers yet unreasonable and unethical business practices must be curbed at the very inception.

Unfortunately, Indian e-commerce websites are operating in an unregulated manner and they need to be suitably regulated as soon as possible. E-commerce websites in India are also engaging in violation of various Indian laws including taxation laws, foreign exchange laws, consumer laws and contractual laws. E-commerce websites in India are also engaging in predatory pricing thereby pushing the small business houses and businessmen out of business.

Books publishers in India have now decided to seek policy as well as legal intervention against the predatory pricing tactics of Indian e-commerce websites. The Federation of Publishers’ and Booksellers’ Associations in India (FPBAI) had recently written to Prime Minister Narendra Modi and the Ministries of Finance, Commerce, and Human Resource Development, complaining about the “questionable trade practices” adopted by e-commerce websites like Flipkart and Amazon. In fact, Myntra, Flipkart, Amazon, Uber, etc have already been questioned by the regulatory authorities of India for violating Indian laws.

S. Chand, a well-known publisher of text books, had also served a legal notice to Flipkart six months ago, accusing it of modifying discount structures, violating the clause, and retailing only their fast-selling titles. S. Chand has also snapped all ties with Flipkart and stopped providing its books to FlipKart since then. However, Flipkart continues to sell S. Chand’s books by sourcing them from wholesalers.

The FPBAI letter also seeks action to protect the publishing trade. E-commerce websites are purchasing books at lower discounts from publishers and distributors and sell the same at higher discounts, making a loss in each transaction. It is indeed a questionable activity as it smacks of the act of predatory pricing. In fact, bookstores such as Capital Book Depot in Chandigarh, Teksons and New Book Depot in Delhi have already shut their shops and many others are struggling for survival due to predatory pricing activities of e-commerce websites in India.

There is an urgent need on the part of Indian government to step in and come out with a dedicated e-commerce law of India to regulate the e-commerce activities in best possible manner. A techno legal framework is long due and Indian government has failed to provide the same so far.