Supreme Court tells CCI to protect competition without undermining market confidence; deleted by Amazon

The Supreme Court said that fair treatment of foreign investors does not mean special treatment. File | Photo credit: The Hindu

The Supreme Court set aside the Competition Commission of India (CCI) order canceling Amazon’s buyout of 49% stake in Future Coupons combined for 2019. The court also set aside a ₹202 million fine imposed on Amazon by the competition regulator.

A bench of Justices Vikram Nath and Sandeep Mehta said in the judgment that enforcement by the regulator must protect competition without undermining market confidence.

He said that the regulator’s interventions to promote competition in the market must not be compromised by unpredictability or form-driven approaches that failed to meet the statutory purpose of the Competition Act 2002.

The Supreme Court said that fair treatment of foreign investors does not mean special treatment. “It means equal treatment under the same law, governed by the same procedural safeguards and disciplined reasoning,” said Justice Nath, who authored the May 27 judgment.

Amazon’s ₹1,431 crore investment in Future Coupons in 2019, which would have given it indirect leverage over Future Retail, collapsed when Future Group tried to sell its retail assets to Reliance Retail in 2020. Amazon challenged the move, only for the CCI to suspend its initial approval of the 2019 Amazon2019 transaction.

The court concluded that the CCI acted beyond its statutory powers by withdrawing the approval granted to the Amazon-Future Coupons combination in 2019. He said the CCI had “contemporary regulatory records”, agreements in place and related arrangements in place while granting the approval.

“It is on this record that the CCI has inspected and granted approval under Section 31(1) of the Act. In these circumstances, a later and more formal look at how the same material should have been described cannot change the approved submission into a case of non-disclosure or suppression of substance,” the apex court said.

The court said the Competition Act, a “forward-looking instrument of economic regulation”, and the CCI play a key role in maintaining and regulating competitive markets in India.

The court said the 2002 law “both promotes and protects”.

“The Act is enacted keeping in mind the economic development of the country, to prevent practices which have an adverse effect on competition, to promote and maintain competition, to protect the interests of consumers and to ensure the freedom of trade carried on by other market participants in India,” the court said.

Justice Nath said the CCI must not apply the 2002 Act as a purely punitive law. The statute also aimed to maintain competitive market structures through a stable and credible regulatory framework.

The court explained that the CCI had a dual objective. Investors should not view it as a competition regulator that only focuses on punitive outcomes while undermining the “promote and maintain” dimension of the law. Conversely, the regulator should not be seen as unwilling to enforce the law against conduct that actually harms competition and threatens consumer welfare and market integrity.

“The regulator has to act on four points of law. Regulatory expertise does not extend jurisdiction. CCI’s power, whether to initiate proceedings, impose sanctions or issue subsequent directions, must be tied to the law and the combination order,” the apex court pointed out.

The court pointed out that certainty in the regulatory and legal regime is essential to attract foreign investors.

“A fair and rule-bound regulatory environment serves the national interest. It protects domestic markets from anticompetitive harm, protects consumers, and assures investors, foreign and domestic, that outcomes will depend on law and evidence rather than ad hoc approaches,” the Supreme Court said.

Published – 29 May 2026 03:45 IST