Amazon Asia Pacific Holdings Private Limited Haverl LLC. Clicktech Retail Private Limited

Page 1 of 8 COMPETITION COMMISSION OF INDIA Combination Registration No. C-2024/04/1128 23rd July 2024 Notice under Section 6(2) of the Competition Act, 2002 given jointly by Amazon Asia- Pacific Holdings Private Limited, Haverl LLC, Clicktech Retail Private Limited, New Trends Commerce Private Limited, and Clicktech Enterprises Private Limited CORAM: Ms. Ravneet Kaur Chairperson Ms. Sweta Kakkad Member Mr. Deepak Anurag Member Order under Section 31(1) of the Competition Act, 2002 1. On 2nd April 2024, the Competition Commission of India (‘Commission’) received a notice (‘Notice’) under sub-section (2) of Section 6 of the Competition Act, 2002 (‘Act’) jointly given by Amazon Asia-Pacific Holdings Private Limited (‘Amazon Asia- Pacific’), Haverl LLC (‘Haverl’), and Clicktech Retail Private Limited (‘CRPL’) [hereinafter, Amazon Asia-Pacific and Haverl are collectively referred to as the ‘Amazon Acquirers’]. 2. The Notice was filed pursuant to the execution of the Share Purchase Agreement dated 6th December 2023 amongst Amazon Asia-Pacific, Zaffre LLC (‘Zaffre’), Zodiac Wealth Advisors LLP (‘Zodiac’), and Frontizo Business Services Private Limited (‘Frontizo’) [‘SPA’]; Business Transfer Agreement dated 7th February 2024 between Combination Registration No. C-2024/04/1128 Page 2 of 8 CRPL, and Appario Retail Private Limited (‘Appario’) [‘BTA’]; Shareholders’ Agreement dated 28th March 2024 amongst Haverl, New Trends Commerce Private Limited (‘NTCPL’), and NTCPL’s shareholders (‘NTCPL SHA’); and Share Subscription Agreement dated 28th March 2024 amongst Haverl, NTCPL, and NTCPL’s shareholders (‘NTCPL SSA’) [hereinafter, Amazon Asia-Pacific and Zaffre are together referred to as ‘Amazon Shareholders’]. 3. The Proposed Combination envisages the following transactions: Proposed Transaction I - Acquisition of 76% of the issued, subscribed, and paid-up share capital of Frontizo by Amazon Asia-Pacific from Zodiac. Pursuant to this, Frontizo and Appario will become wholly-owned subsidiaries of Amazon Shareholders. Proposed Transaction II – Acquisition of Appario’s business, through a slump sale as a going concern by CRPL. In this regard, it is submitted that Proposed Transaction II will precede Proposed Transaction I and the cessation of Appario’s retail business and de- registration from www.amazon.in/business are condition precedents for the consummation of Proposed Transaction I. Proposed Transaction III – Acquisition of 1% shareholding in NTCPL by Haverl, on or about the date of consummation of Proposed Transaction I and Proposed Transaction II and subject to the completion of Proposed Transaction IV and Proposed Transaction V. Proposed Transaction IV – Issuance of certain additional shares by NTCPL to its promoter, Clicktech Enterprises Private Limited (‘CEPL’). Proposed Transaction V – Issuance of certain additional shares by CRPL to NTCPL. It is submitted that Proposed Transaction IV and Proposed Transaction V involve intra- group transactions within the Poddar Group (defined in subsequent paragraphs). These Combination Registration No. C-2024/04/1128 Page 3 of 8 transactions are proposed to be completed before Proposed Transaction III [hereinafter, Proposed Transaction I, Proposed Transaction II, Proposed Transaction III, Proposed Transaction IV, and Proposed Transaction V are collectively referred to as the ‘Proposed Combination’]. 4. In terms of Regulation 14 of the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011, vide letter dated 18th April 2024, certain information and clarifications were sought from the parties. Responses were submitted dated 25th April 2024 and 6th May 2024, after seeking an extension of time. Since responses were not complete, another letter was issued on 21st May 2024 and the responses were submitted dated 28th May 2024 and 4th June 2024, after seeking an extension of time. As these responses were not complete, another letter was issued on 13th June 2024 and a response dated 18th June 2024 was submitted. In furtherance to the response dated 18th June 2024, the parties provided complete information vide submission dated 26th June 2024. 5. In response to the letter dated 18th April 2024, NTCPL and CEPL also became notifying parties by furnishing relevant documents [hereinafter, Amazon Acquirers, CRPL, NTCPL and CEPL are collectively referred to as the ‘Notifying Parties’]. 6. Amazon Asia-Pacific is an indirect wholly-owned subsidiary of Amazon.com, Inc. (‘ACI’), which is the ultimate parent entity of the Amazon group (‘Amazon Group’). ACI has certain indirect subsidiaries either registered in India or having business operations in India (‘Amazon Affiliates’). Amazon Affiliates are engaged in businesses relating to the retail (‘B2C’) market, payment processing, wholesale (‘B2B’) sales, etc. Further, some of the direct or indirect subsidiaries of ACI have stakes in certain entities operating in India (‘Amazon Portfolio Companies’). 7. Amazon Asia-Pacific acts as the seller of record for the distribution of digital Kindle content to end customers in India. It earns fees from the sale of digital content such as e- books, digital magazines, etc. It has also recently started licensing the Amazon brands. Combination Registration No. C-2024/04/1128 Page 4 of 8 Amazon Asia-Pacific does not have a sales office, factory, liaison office, branch office, or franchise in India. 8. Haverl is the direct wholly-owned subsidiary of ACI and belongs to the Amazon Group. It is engaged in the business of making investments. It does not undertake any business activities in India. 9. It is submitted that ACI has, inter alia, investment in the following Indian entities: (a) Amazon Seller Services Private Limited (‘ASSPL’): It operates the online marketplaces i.e., www.amazon.in and www.amazon.in/business (collectively, ‘Amazon India Marketplace’), which facilitates third-party sellers to offer various products for sale to customers on B2C and B2B basis. (b) Amazon Retail India Private Limited (‘ARIPL’): It is engaged in B2C retail trading of food products produced and/or manufactured in India. (c) Sociofy Enterprise Private Limited (‘Sociofy’): It operates the marketplace, ‘Glowroad’ which facilitates the sale of various products by third-party sellers to customers across India. (d) Amazon Wholesale (India) Private Limited (‘AWIPL’): It is engaged in B2B sales/ wholesale trading of various products in India. (e) Amazon Web Service India Private Limited (‘AWS India’): It is engaged in the provision of IT services. (f) Amazon Development Centre India Limited (‘ADCIL’): It is, inter alia, engaged in the provision of administrative support services such as financial transaction processing and accounting services to businesses. (g) Amazon Pay (India) Private Limited (‘APIPL’): It is engaged in operating a semi- closed loop wallet ‘Amazon Pay’ and offers digital payment solutions to end- customers and merchants. (h) Amazon Transportation Services Private Limited (‘ATSPL’): It is engaged in providing logistics and transportation services and provides its services only to ASSPL. Combination Registration No. C-2024/04/1128 Page 5 of 8 (i) Amazon Digital Services Private Limited (‘ADSPL’): It provides software tools and technical solutions to businesses to enable them to sell online. (j) Amazon Smart Commerce Solutions Private Limited (‘Amazon Smart Commerce’): It is engaged in providing Business Onboarding and Integration Services (‘BOIS’)1 to sellers on the Amazon India Marketplace. 10. Frontizo is an Indian company, which is held by Amazon Shareholders [24%] and Zodiac [76%], an entity that is owned and controlled by members of the Patni family. Frontizo is engaged in the business of providing customer support services to customers on the Amazon India Marketplace, and to customers of the online marketplace operated by Amazon Group in North America. 11. Appario is a wholly-owned subsidiary of Frontizo. Appario is engaged in B2C and B2B business in India, and currently offers goods for sale on Amazon India Marketplace operated by ASSPL. 12. Poddar Group includes entities promoted by Mr. V. B. Poddar, namely CRPL, NTCPL, CEPL, and their parent entity, New Trends Trust (‘NTT’). Mr. V. B. Poddar’s affiliates are also considered for assessment. 13. CEPL is a wholly-owned subsidiary of NTT and is currently not engaged in any business activities in India. Apart from NTCPL and CRPL, CEPL does not have any other direct or indirect subsidiaries in India. 14. NTCPL is a wholly-owned subsidiary of CEPL and is currently engaged in the business of wholesale trading of sugar, primarily through the offline channel. However, NTCPL