ED Probe: Amazon Moves SC Seeking Protection For Privileged, Confidential Digital Data

Amazon Seller Services, the Indian marketplace unit of ecommerce giant Amazon, has reportedly moved the Supreme Court to seek protection for its privileged and confidential digital data.

The Enforcement Directorate (ED) is asking for information from the ecommerce major in a FEMA violation case going back to 2014, ET reported.

Amazon alleged that the ED has been summoning and compelling its employees to share confidential information stored on their laptops and phones.

Hence, the company has sought protection against “forceful disclosure of such digital data which records legal advice from professional legal advisors as also material that was prepared in contemplation of investigation or seeking legal advice”.

Amazon also said that email correspondences and chats, an integral part of privacy, also need protection. Additionally, the company has sought protection of its constitutional and fundamental rights, especially the right to privacy, the report said.

A bench led by Justice SK Kaul sought responses from the Finance Ministry and the ED in the case after hearing senior counsel Siddharth Luthra, who was representing Amazon.

Amazon has combined the petition with another pending case that also raises similar privacy issues.

Luthra argued that despite providing all necessary support and cooperation, the ED has continued the investigation for over eight years without coming to any logical conclusion. He said that such an open-ended inquiry is not permissible under the Indian laws.

“This legal vacuum has facilitated ongoing and continuing police practices of dubious constitutionality, roving and fishing investigations seeking access to mobile devices and laptops and making ‘clone’ copies of their complete contents, where an individual can also be compelled to ‘unlock’ their mobile phones and laptops,” Amazon said.

Amazon also requested the Court to suggest a legislation or a statutory framework for submission of digital devices, search and seizure of those devices, and examination of their contents. Along with that, it also requested the court to issue appropriate guidelines to fill the vacuum till the legislation or a statutory framework is ready.

Amazon has been facing a lot of regulatory scrutiny in India. Earlier this year, the Competition Commission of India (CCI) conducted raids at offices of Amazon India’s two top sellers. In 2020, the CCI ordered a probe into the alleged anti-competitive practices of Amazon and its rival Flipkart. The Indian government is also looking  to ban flash sales and deep discounting in a bid to protect sellers from marketplaces that offer big discounts under the ‘Consumer Protection (E-commerce) Rules, 2020’.

Amazon is a key player in the Indian ecommerce market, with Walmart-owned Flipkart being its main competitor. The country’s ecommerce market is estimated to reach a size of $400 Bn by 2030, clocking a compound annual growth rate of 19% between 2022 and 2030.