Amazon’s behavior is under multiple investigations as it could constitute a breach under Article 102 of the Treaty of Functioning of the European Union for abuse of dominant position.
On the 10th of November the European Commission (the “EC”) released a Statement of Objections towards Amazon, informing it of its breach of EU antitrust rules by distorting competition in online retail markets. Amazon has a dual role as a platform: i) provide a marketplace where independent sellers can sell and ii) sell products as a retailer on the same market in competition with the aforementioned sellers. The problem lies in the fact that, according to the preliminary findings of the EC, the US firm collects large quantities of non-public seller data and uses them to strategically choose own products to offer, at disadvantage of the other marketplace sellers.
Furthermore, the EC opened a second antitrust investigation against Amazon in relation to its business practices. The concern is that Amazon may be favoring its own retail offers and the offers of independent sellers using its logistic and delivery systems. The investigation will focus firstly on the criteria used by the Seattle’s based firm when it chooses the winner of the “Buy Box” and enables sellers to offer products to Prime users, in order to understand if there is a preferential treatment. Secondly, it will focus on the possibility for independent sellers to reach Prime users, which tend to generate more sales.
Both investigations are crucial. Needless to say, an abuse of dominant position in today’s platform economy is particularly risky. Especially due to the crisis where more and more sellers and consumers are dependent, in different ways, on these platforms. Is it fair for Amazon to exploit other sellers’ data for its own profit? Are independent sellers really free and competing when on Amazon’s marketplace?
The Statement of the EC is available here: https://ec.europa.eu/commission/presscorner/detail/en/STATEMENT_20_2082
