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LONDON (AP) – European Union regulators on Tuesday filed antitrust charges against Amazon, accusing the e-commerce giant of using its access to data to gain an unfair advantage over merchants using its platform.
The EU Executive Commission, the bloc’s main antitrust law enforcement official, raised the charges after it began investigating the company two years ago. In addition to Amazon’s regulatory headaches, EU officials have also opened a second investigation into whether the company favors product offerings and merchants that use its own logistics and delivery system.
It is the latest effort by Executive Vice President Margrethe Vestager, the EU competition commissioner, to reduce the power of big tech companies. She slapped Google with antitrust fines totaling nearly $ 10 billion and opened two antitrust investigations against Apple this summer. The US has also started to take a harder line, suing Google this year for abusing its dominant position in online search and advertising.
It’s not a problem that Amazon is big and prosperous, said Executive Vice President Margrethe Vestager, EU competition commissioner. But “our concern is very specific business conduct which appears to distort actual competition.”
EU officials focused on the company’s dual role as market and retailer. In addition to selling its own products, the US company allows third-party retailers to sell their own products through its site.
The commission challenged Amazon’s systematic use of trade data to which it has exclusive access to avoid normal competitive risks and to take advantage of its dominance over e-commerce services in France and Germany, the two largest markets in society in the EU.
Amazon faces a fine of up to 10% of its global annual revenue, which could rise to $ 28 billion based on its 2019 profits. The company has dismissed the charges.
“We do not agree with the preliminary assertions of the European Commission and will continue to do everything possible to ensure that it has an accurate understanding of the facts,” the company said in a statement. Under EU rules, he can respond to charges in writing and present his case at a hearing.
Investigators analyzed data covering 80 million transactions and 100 million products listed on the Amazon site. Vestager said they found that “very granular, real-time business data” on product listings and third-party transactions has been fed into algorithms for Amazon’s retail business that decide which new products to launch, their price. and their supplier.
“In other words, this is a big data case,” Vestager said at a press briefing.
Regular retailers take risks when they invest heavily to find new products, bring them to market and decide what price to sell them for, Vestager said. “Our concern is that Amazon can avoid some of these risks by using the data to which it has access.”
The stakes have risen for retailers as many European countries have temporarily closed non-essential stores to try and contain the coronavirus pandemic, pushing more online shopping, where Amazon is a major presence.
The second EU survey will look at the criteria Amazon uses to decide which seller’s product will be chosen for the ‘buy box’ and for its Prime membership service, and whether that means they get a preferential treatment from the company’s logistics and delivery services.
The shopping box, located on the right side of the Amazon site, allows buyers to add items directly to their shopping carts. The box features a single seller’s product even though multiple merchants may offer it.
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For all AP technical coverage, visit https://apnews.com/apf-technology
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Follow Kelvin Chan on www.twitter.com/chanman
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