Amazon is under the scrutiny of the Competition Commission over alleged anti-competitive practices.
Allegations that Amazon's legal representatives bribed officials in India will be investigated, the government said today, stressing on a "zero-tolerance" policy towards corruption. The US e-commerce giant is also believed to have launched a probe into the allegation reported by a US website.
"As far as the government of India is concerned there is ZERO tolerance towards corruption of ANY kind in the government," officials said.
They said reports did not clarify "which era" the alleged act took place and in which state.
"Amazon has been spending more than Rs 8,500 crore in legal fees. It's time to think where all it is going. The whole system seems to work on bribes and that is not the best of business practices," said government officials, lashing out at Amazon and urging it to punish those breaking the law.
The officials cited the public accounts of some Amazon companies, which showed nearly Rs 8,500 crore in legal fee in two years.
According to a report by website The Morning Context, Amazon has launched an investigation against some of its legal representatives after a whistleblower flagged allegations of bribing Indian government officials. The company's senior corporate counsel has reportedly been sent on leave.
The report said legal fees paid to an independent lawyer hired by the company was in part "funnelled into bribing government officials".
Reports yesterday quoted Amazon as saying it takes allegations of improper actions seriously and investigates them fully to take appropriate action.
Without confirming or denying the allegations, Amazon said it has "zero tolerance for corruption".
"We have zero tolerance for corruption. We take allegations of improper actions seriously, investigate them fully, and take appropriate action. We are not commenting on specific allegations or the status of any investigation at this time," an Amazon spokesperson was quoted as saying by news agency PTI.
PTI quoted an unnamed person close to the developments as saying that US-headquartered companies like Amazon take whistleblower complaints seriously, "especially those related to payment of bribes to foreign government officials in order to retain or obtain business". This is also to ensure compliance with corporate governance rules.
The Confederation of All India Traders (CAIT) has written to Union Commerce Minister Piyush Goyal demanding a CBI inquiry into the allegations, saying it involves the credibility of the government and is counter to the vision of removing corruption at all levels within the government.
The traders' body has also demanded that the officials involved be named and punished.
CAIT said it would also approach the US Securities and Exchange Commission (SEC) Chairman Gary Gensler to demand a "fair and independent probe".
CAIT National President BC Bhartia and Secretary General Praveen Khandelwal said it needs to be inquired whether the alleged bribery has "any connection with the ongoing investigation or related with continuous violation of the law and rules by Amazon".
These steps, they said, were needed to protect the Indian e-commerce market and retail trade from "undue influence, abuse of dominance and connivance with government officials", they added.
Amazon is already under the scrutiny of the Competition Commission of India over alleged anti-competitive practices, predatory pricing and preferential treatment of sellers.
Amazon is also legally fighting the Future Group over its ₹ 24,713-crore deal with its retail rival in India, Reliance Retail. Amazon is an investor in Future Coupons, which is a shareholder in Future Retail.
(Except for the headline, this story has not been edited by NDTV staff and is published from a press release)