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Amazon Files Lawsuit Against Indian Financial Crime Agency Investigating A 2019 Deal

Amazon Files Lawsuit Against Indian Financial Crime Agency Investigating A 2019 Deal Inc is suing India's financial crime fighting agency to stop an inquiry into one of its 2019 transactions, according to reports based on information from a court filing,
For months, India's Enforcement Directorate (ED) has been investigating Amazon's $200 million investment in India's Future Group for possible breach of foreign investment laws.
The investment has been the subject of lengthy court fights, with Amazon citing violation of contract by Future to halt the $3.4 billion sale of the Indian firm's retail operations to a competitor.
Amazon called the investigation a "fishing and roving" investigation in an 816-page file reviewed by Reuters, claiming the ED sought confidential legal advice and views from Amazon as well as other information unrelated to the Future Group purchase.
The ED had questioned several Amazon executives, including its India CEO, in recent weeks, and the inquiry had resulted in "unnecessary harassment," the e-commerce giant said in a plea to the Delhi High Court on Dec. 21.
"The directions by the ED asking for disclosure of legally privileged documents and litigation privilege information is derogatory of the principles" laid out in Indian constitution, Amazon said in the filing. The court documents have not been made publicly available.
"The investigation is a fishing and roving exercise," Amazon reportedly has said in the court filing.
There was no comment on the court case from Amazon. No reaction from ED was available either. This investigating agency does not provide details of its investigations in the public domain.
The lawsuit is the latest development in Amazon and Future's lengthy feud. Despite the fact that India's antitrust regulator halted their 2019 deal last week, alleging that Amazon withheld information when pursuing approval for te deal, the ED's investigation is unrelated to that.
The disagreement revolves around three business deals signed by Future and Amazon businesses, which a Singapore arbitration panel, which is also hearing the case, has stated must be read together when evaluating the purchase.
Future claims that combining the commercial agreements would make the deal illegal under Indian law.
A notification from the ED dated Feb. 19 was included in Amazon's court filing, asking for facts about its investment in Future, including copies of agreements, bank account information, and other related internal communication.
It also revealed that the ED is launching a much broader investigation, requesting information on large sellers on Amazon's Indian e-commerce website, including sales figures for those who account for more than 5% of total sales.
The notification came after a Reuters investigation in February discovered that Amazon aided a limited fraction of Indian retailers succeed by offering them cheaper fees and allowing them to circumvent foreign investment regulations.
Amazon stated at the time that it was confident in its compliance with legislation and that it "does not provide any vendor on its marketplace preferential treatment."

Christopher J. Mitchell

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