The European Commission believes Amazon violated competition rules by unfairly benefiting from non-public data on independent sellers who use its marketplace, it said in its preliminary findings from an antitrust investigation underway against the American e-commerce giant since last year. The European Union’s executive body added it was also launching a new probe into possible preferential treatment of marketplace sellers that use Amazon’s logistics and delivery services.
In a statement of objections, which followed the opening of an investigation into Amazon’s use of sensitive data from independent sellers in July 2019, the commission outlined its initial view that the use of private marketplace seller data “allows Amazon to avoid the normal risks of retail competition and to leverage its dominance in the market for the provision of marketplace services in France and Germany,” which are Amazon’s biggest markets in the EU.
More than 70 percent of consumers in France and more than 80 percent of consumers in Germany that made online purchases bought something from Amazon in the last 12 months, according to the commission.
The European Commission said initial findings from that investigation had shown that large quantities of non-public seller data “are available to employees of Amazon’s retail business and flow directly into the automated systems of that business, which aggregate these data and use them to calibrate Amazon’s retail offers and strategic business decisions to the detriment of the other marketplace sellers.”
“We do not take issue with the success of Amazon or its size,” Margrethe Vestager, the EU’s antitrust commissioner, said at a press conference. She added the investigation focused on “very specific business conduct” tied to Amazon’s role as both retailer and a platform for smaller competitors.
Amazon said it disagreed with the commission’s finding and “will continue to make every effort to ensure it has an accurate understanding of the facts.” Amazon added that it represents less than 1 percent of the global retail market. “No company cares about small businesses or has done more to support them over the past two decades than Amazon,” the e-tailer said.
The commission also opened a new antitrust probe into Amazon’s business practices, looking into whether the criteria the company uses to select the winner of the so-called “Buy Box” and to enable sellers to offer products to users of its Prime loyalty program leads to preferential treatment either of Amazon’s own retail business or of sellers that use its logistics and delivery sellers.
The second probe covers the European Economic Area, with the exception of Italy, whose competition authority started to investigate partially similar concerns last year and will cooperate with the European Commission throughout this investigation.
“Online shopping has become almost essential in recent months for many consumers because of the Covid-19 crisis,” commented Monique Goyens, the director general of the European consumer organization BEUC. “It would be very harmful for consumers if a powerful player like Amazon could abuse its strong position as a marketplace to unfairly undermine independent retailers and to deprive consumers of genuine choice,” she added, welcoming the European Commission’s investigations.
As the European Commission’s scrutiny of Amazon increases, India’s antitrust regulator opened an investigation regarding Google for alleged abuse of its dominant market position to promote its payments service Google Pay over other payment options.