India’s Enforcement Directorate has reportedly warned e-commerce giant Flipkart it could be faced with a $1.35bn fine for foreign investment law violations.
The regulator, which is also investigating Amazon, is examining whether investment laws have been avoided, which regulate multi-brand retail companies and stop them acting as marketplaces for sellers, according to a report from Reuters, which cites three sources and an agency.
In Flipkart’s case, the regulator claims the e-commerce platform received a foreign investment and interacted with a related party, WS Retail, and then sold goods to consumers through its website.
The regulator has issued its warning and called on the senior staff to explain why they should not be hit with the fine, the article said.
Flipkart is believed to have 90 days to respond to the notice.
The e-commerce company recently closed a colossal $3.6bn in what is believed to be a pre-IPO funding round, according to TechCrunch. This investment put its valuation at an impressive $37.6bn.
Copyright © 2021 FinTech Global
Copyright © 2018 RegTech Analyst
