(MENAFN) Amazon.com's operations in India are under investigations by the authorities to check whether the company is violating local retailing rules, Gulf Times reported.
The Enforcement Directorate of the Ministry of Finance is investigating whether Amazon.com's fully-owned Indian subsidiary has been evading restrictions on foreign investment in retail by selling directly to customers while making it look as if the sales are being made by other companies.
Due to Indian regulations, foreign firms aren't allowed to own majority stakes in retail companies that sell more than one brand. Amazon is allowed in India only because it acts as a marketplace rather than a retailer.
Under these regulations, Amazon can let local retailers list their products on its website, help them with payments and even deliver those products to customers, but it is not allowed to sell products directly.
Amazon launched its India site just last year and already has grown into one of the biggest online marketplaces in Asia's third-largest economy, selling more than 17 million products.
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