The European Commission on Tuesday 10 November sent the Amazon group a ‘Statement of Objections’ (see EUROPE 12298/9) accusing them of distorting competition in online retail markets.
Amazon routinely uses non-public business data from independent sellers active in its marketplace for the benefit of its own retail business, which competes directly with those third-party sellers.
Margrethe Vestager, Executive Vice-President, Competition Policy, stated that data relating to the activity of third-party vendors “should not be used to the benefit of Amazon when it acts as a competitor to these sellers. The conditions of competition on Amazon’s platform must also be fair. (...) A fair and undistorted access to consumers online is important for all sellers”.
Amazon has access to the non-public commercial data of third-party sellers (units of products ordered and shipped, seller revenue in the marketplace, number of visits to seller offerings, etc.)
The Commission has found that considerable volumes of non-public vendor data are available to employees in Amazon’s retail business and flow directly into the latter’s automated retail systems that aggregate this data and use it to calibrate Amazon’s retail offerings. This allows Amazon to focus its offerings on the best-selling products in different categories and to adjust its offerings based on non-public data from competing sellers.
The Commission’s preliminary view is that the use of non-public data from its marketplace vendors allows Amazon to avoid the normal risks of competition in the retail market and to take advantage of its dominant position in the market for the provision of marketplace services in France and Germany, Amazon’s largest markets in the EU. If confirmed, this practice would be contrary to Article 102 of the Treaty on the Functioning of the European Union (TFEU), which prohibits abuses of a dominant market position.
Vestager noted that the value of online sales has almost doubled in five years (€720 billion in 2020).
In addition, the Commission has opened a second antitrust investigation into Amazon’s business practices which may artificially favour its own retail offers and the offers of its marketplace vendors who use Amazon’s logistics and delivery services.
It will consider whether the criteria set by Amazon for selecting the winner of the ‘Buy Box’ and allowing sellers to offer products to Prime users (Amazon’s Reward Loyalty Programme) result in preferential treatment of Amazon’s retail business or of sellers who use Amazon’s logistics and delivery services. (Original version in French by Lionel Changeur)