Sunday, June 14, 2020

Amazon reportedly faces EU antitrust charges over use of third-party seller data

The European Union is set to file formal antitrust charges against Amazon over its use of third-party seller data, The Wall Street Journal reports. The charges, which could be filed as soon as next week, will reportedly accuse Amazon of using data gathered from sellers on its marketplace to compete against them.

After the EU’s charges are filed, The Wall Street Journal reports that it’s expected to be another year before the commission formally decides whether Amazon broke the law. Although the company could challenge the decision in court, it could eventually be fined as much as 10 percent of its annual revenue.

The investigation is thought to go back almost two years

The EU’s investigation into the practice is thought to go back almost two years. Back in September 2018, the head of the EU’s competition bureau, Margrethe Vestager, said that the EU had been gathering information on Amazon’s practices toward third-party sellers, but she stressed at the time that a formal investigation had yet to be launched. Last year, the EU launched a formal antitrust investigation into the agreements between Amazon and its marketplace sellers as well as how it uses data to select which retailer to link to using the “Buy Box” on its site.

This would not be the first time Amazon has been accused of using its position as an operator of a marketplace to benefit itself as a seller within it. Earlier this year, The Wall Street Journal reported that Amazon’s employees would use sales data from independent Marketplace sellers to help with the development of Amazon’s own-branded products. This was said to have happened despite the company having rules that forbid it.

Amazon promised to launch an internal investigation in response, but the report generated renewed scrutiny from US lawmakers. Democrats on the House Judiciary Committee wrote to the company to ask it to clarify its data policies since it had previously claimed to not use individual seller data to directly compete with them on its platform. Sen. Josh Hawley (R-MO) called for a criminal antitrust probe into the company.

Amazon declined to comment to The Verge on the report.

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