Amazon's India Site Restocked After Joint-Venture Stake Cut
By Corinne Abrams
MUMBAI--Hundreds of thousands of products are back on Amazon.com Inc.'s India website after it restructured its investments to get around restrictions that forced sellers to pull items from the site this month.
The e-commerce giant sold a chunk of its stake in a joint-venture whose subsidiary sold products on the website, bringing it in line with new rules, a person familiar with the matter said.
Foreign e-commerce sites aren't permitted to sell directly to customers in India, but Amazon worked around those rules by selling through subsidiaries of companies in which they owned stakes. In December, India clarified the rules to say that foreign companies couldn't sell products even through those subsidiaries.
Amazon and Walmart Inc.-owned Flipkart lobbied for clarifications and changes in the rules, which came into effect on Feb. 1. The same day, thousands of products disappeared from Amazon's India site.
Amazon has since reduced its stake in Prione Business Services Pvt. Ltd., a joint venture that is the parent company of one of its biggest sellers, Cloudtail India Pvt. Ltd., to below 26% from 49%, the person familiar with the matter said.
Catamaran Advisors LLP, Amazon's partner in Prione, increased its stake in the venture to 76%, Catamaran CEO Abishek Laxminarayan said. "Catamaran has effected the required changes to be 100% compliant," with the new regulations, Mr. Laxminarayan said in a statement.
Most of the products Cloudtail sells on Amazon, which include everything from diapers to Amazon Echo, have been relisted, the person said.
Amazon is also considering selling some of its stake in the parent company of another seller, Appario Retail Private Ltd., the person familiar with the matter said.
Flipkart has said it is reviewing its supply chain. Analysts have said that company may be affected by another clarification that says sellers shouldn't sell more than 25% of their products on one marketplace. A Flipkart spokesman didn't respond to requests for comment.
Write to Corinne Abrams at firstname.lastname@example.org
(END) Dow Jones Newswires
February 08, 2019 07:32 ET (12:32 GMT)Copyright (c) 2019 Dow Jones & Company, Inc.