Wed, May 22, 2024

European Commission vs. U.S. Tech Giant

The street that connects the Council of the EU to the European Commission.

Tech companies around the world have to deal with various scandals as well as lawsuits. According to the European Commission, Amazon is misusing the data it collects from third-party sellers on its platform.

It is worth noting that,  Amazon is systematically using non-public marketplace seller data to unfairly compete with sellers in France and Germany. As a reminder, the accusations are the result of an investigation that was announced in 2019. Based on the Commission’s preliminary view, the use of non-public marketplace seller data allows Amazon to avoid the normal risk of retail competition and to take advantage of its dominance in the market for the provision of marketplace services in Germany and France. People should take into account that, France as well as Germany, are the biggest markets for Amazon in the EU.

Importantly, the Commission believes that the tech giant is using very large quantities of non-public seller data to help its retail business. As a result, other marketplace sellers have to deal with unfair competition. Amazon will have the opportunity to clarify its position regarding this investigation in the coming weeks.

European Commission and main findings

It is not surprising that Amazon does not agree with the European Commission. According to the tech giant, no company cares more about small businesses than Amazon. Moreover, it supports small businesses for more than two decades. Importantly, there are more than 150,000 European businesses that sell products through Amazon’s stores. They generate tens of billions of Euros in revenues. Moreover, companies created hundreds of thousands of jobs.

It is worth mentioning that, the Commission is opening a second antitrust investigation into the company. The European Commission wants to investigate whether the tech giant gives preferential treatment to its own retail offers and marketplace sellers, that use its logistics and delivery services. Importantly,  this investigation will look at how Amazon decides which merchant to link to using its “Buy Box”.

People should keep in mind that, Amazon’s Marketplace platform, which now accounts for over half of its physical merchandise sales. Unfortunately, the platform attracted scrutiny over years.

Interestingly, apart from the European Commission, individual European countries also conducted their own investigations. Notably, Amazon agreed to change its terms of service for third-party merchants in response to an investigation of German regulators. Amazon agreed to give sellers 30 days notice as well as a reason before remaining them from its platform.

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