EU regulators on Tuesday filed antitrust charges against Amazon.com Inc, accusing the e-commerce giant of using its access to data from companies that sell products on its platform to gain an unfair advantage over them.
The charges, filed two years after the bloc’s antitrust enforcer began looking into the company, are the latest effort by European regulators to curb the power of big technology companies.
EU Commissioner for Competition Margrethe Vestager has slapped Google with antitrust fines totaling nearly US$10 billion and opened twin antitrust investigations this summer into Apple Inc.
Photo: AFP
The European Commission also opened a second investigation into whether Amazon favors product offers and merchants that use its own logistics and delivery system.
The EU investigation found that Amazon is accessing and analyzing real-time data from other vendors that sell goods on its platform to help it decide which new products of its own to launch and how to price and market them.
That “appears to distort genuine competition,” Vestager said.
Investigators focused on that practice in France and Germany, the company’s two biggest markets in the EU, but Vestager did not give specific examples of merchants affected by Amazon’s behavior.
Amazon faces a possible fine of up to 10 percent of its annual worldwide revenue. That could amount to as much as US$28 billion, based on its earnings last year.
“We disagree with the preliminary assertions of the European Commission and will continue to make every effort to ensure it has an accurate understanding of the facts,” Amazon said in a statement, adding that it represents less than 1 percent of the global retail market and that there are bigger retailers in every country where it operates.
Under EU rules, it can reply to the charges in writing and present its case in an oral hearing.
It could still be a while before a final decision as there are no deadlines for bringing an EU antitrust case to an end.
An analysis of millions of transactions and products listed on Amazon’s site found that “very granular, real-time business data” on third-party product listings and transactions were fed into algorithms for Amazon’s retail business that decide which new products to launch, their price and supplier, Vestager said.
Ordinary retailers take risks when they invest heavily to find new products, bring them to market and decide how much to sell them for, Vestager said.
“Our concern is that Amazon can avoid some of those risks by using the data it has access to,” she told reporters at a briefing in Brussels.
The preliminary conclusion is that by using the data, Amazon can focus on the best-selling products, “and this marginalizes third-party sellers and caps their ability to grow,” she said.
The second investigation would look at the criteria Amazon uses to decide which seller’s product gets chosen for the “buy box” and for its Prime membership service, and whether that means they get preferential treatment by the firm’s logistics and delivery services.
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