EU Commission opens Amazon antitrust investigation
The European Commission has opened a formal antitrust investigation into Amazon’s use of data from independent retailers with respect to EU competition rules.
“European consumers are increasingly shopping online,” said Commissioner Margrethe Vestager in a statement on the commission’s web site. “E-commerce has boosted retail competition and brought more choice and better prices. We need to ensure that large online platforms don’t eliminate these benefits through anti-competitive behaviour. I have therefore decided to take a very close look at Amazon’s business practices and its dual role as marketplace and retailer, to assess its compliance with EU competition rules.”
The statement says that Amazon has a dual role as a platform in that it both a retailer and it provides a marketplace where independent sellers can sell products directly to consumers. Thus, the commission says that in providing a marketplace for independent sellers, Amazon continuously collects data about the activity on its platform. The commission says that, based on the its preliminary fact-finding, the retail giant “appears to use competitively sensitive information – about marketplace sellers, their products and transactions on the marketplace”.
The statement from the commission says the investigation will examine the standard agreements between Amazon and marketplace sellers, which allow Amazon’s retail business to analyse and use third party seller data. In particular, it said it will focus on whether and how the use of accumulated marketplace seller data by Amazon as a retailer affects competition.
Furthermore, it will look into the role of data in the selection of the winners of the “Buy Box” and the impact of Amazon’s potential use of competitively sensitive marketplace seller information on that selection. The “Buy Box” is displayed prominently on Amazon and allows customers to add items from a specific retailer directly into their shopping carts. Winning the “Buy Box” seems key for marketplace sellers as a vast majority of transactions are done through it, said the commission.
The practices under investigation “may breach EU competition rules on anticompetitive agreements between companies (Article 101 of the Treaty on the Functioning of the European Union (TFEU)) and/or on the abuse of a dominant position (Articles 102 TFEU)”.
The statement says the commission will now carry out its in-depth investigation as a matter of priority. It adds that it has informed Amazon and the competition authorities of the member states that it has opened proceedings in this case, with no legal deadline for bringing an antitrust investigation to an end. The duration of an antitrust investigation depends on a number of factors, the commission states, including the complexity of the case, the extent to which the undertakings concerned cooperate and the exercise of the rights of defence.