European Union Files Antitrust Charges Against Amazon
This week, European Union regulators brought antitrust charges against Amazon.com, The New York Times reported. The EU claims that the e-commerce giant broke competition laws by wrongfully using its size and access to data against smaller sellers that rely on the company to reach consumers. Specifically, Amazon is accused of collecting nonpublic data from sellers who use its marketplace to spot popular products, then copy and sell them, often at a lower price.
There are two charges being made against Amazon.
"First, it's alleged that the Amazon retail business has free access to valuable non-public data generated from the marketplace business relating to the businesses of merchants selling products on the Amazon marketplace," Ron Moscona, a partner at the international law firm Dorsey & Whitney, told total Retail. "That data allows Amazon’s retail business to compete against those same merchants (by selling competing goods), limiting their ability to grow their businesses."
The second charge is that Amazon was giving unfair advantages to sellers that use its fulfillment services, and skewing highlighted product offers to favor Amazon itself.
Amazon now has a chance to respond to the charges. "The findings of the Commission at this stage are interim and Amazon can still persuade the Commission that its practices do not amount to an abuse of a dominant position," Moscona said. The two could also reach a settlement, or the case could be dropped.
Total Retail's Take: Authorities in the United States and Europe have recently been taking a closer look at other large corporations' business practices as well. For example, last month, antitrust charges were brought against Google, and both Apple and Facebook are also facing investigations in Brussels and Washington.
"The investigation and findings of the EU Commission is part of a growing trend of antitrust investigations and regulatory enforcement action being taken in the EU and in other countries against big tech companies," Moscona shared. We will have to wait and see what comes out of the legal matter, and if Amazon's position in the EU is weakened at all. As for its U.S. business, Amazon has only strengthened operations during the pandemic, as many online shoppers go to Amazon first when making a purchase decision.
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Ashley Chiaradio is the Senior Content Strategist at Total Retail. Ashley has been creating content for more than 7 years, and provides a unique insight in covering the retail industry having worked directly for retailers in the past. She’s passionate about profiling women leadership in the space.