EU Commission accuse Amazon of abusing competition rules

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The EU have accused Amazon of abusing competition rules and using data from 3rd party merchants selling on it’s marketplace to boost sales of Amazon own brands in France and Germany.

The EU Commission also opened a second formal antitrust investigation into the possible preferential treatment of Amazon’s own retail offers and those of marketplace sellers that use Amazon’s logistics and delivery services

Margrethe Vestager, Executive Vice-President and EU Competition Commissioner said that it was imperative that marketplaces did not distort competition.

“We must ensure that dual role platforms with market power, such as Amazon, do not distort competition. Data on the activity of third party sellers should not be used to the benefit of Amazon when it acts as a competitor to these sellers. The conditions of competition on the Amazon platform must also be fair. Its rules should not artificially favour Amazon’s own retail offers or advantage the offers of retailers using Amazon’s logistics and delivery services. With ecommerce booming, and Amazon being the leading e-commerce platform, a fair and undistorted access to consumers online is important for all sellers.”
– Margrethe Vestager, Executive Vice-President, EU Commission

The Commission’s preliminary findings show that very 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. For example, it allows Amazon to focus its offers in the best-selling products across product categories and to adjust its offers in view of non-public data of competing sellers.

This competition rules investigation won’t affect marketplaces such as eBay and OnBuy who don’t compete with the small businesses that sell on their platforms. However the reach could be further than Amazon and bring other retailer come marketplaces under the spotlight, although there is no suggestion that other platforms have abused data from their 3rd party merchants.

“Any ecommerce platform that positions itself in direct competition with its sellers has a flawed business model. That’s why I started OnBuy.com – to create a fairer, more ethical sales platform and a level playing field for all”
– Cas Paton, CEO & Founder, OnBuy

Amazon naturally refuted the suggestion that they abuse their dominant market position or break competition rules, emphasising that they are a champion of small businesses.

“Amazon represents less than 1% of the global retail market, and there are larger retailers in every country in which we operate. No company cares more about small businesses or has done more to support them over the past two decades than Amazon.”
– Amazon