European Commission suspects Amazon of distorting competition

Ecommerce giant Amazon also acts as a conduit for other sellers and the EC reckons it may be abusing that position to favour itself.

Half the time, when you buy something from Amazon, it’s merely acting as the façade and fulfilment partner for another retailer. Amazon presumably makes more money from selling something itself and the European Commission has got a feeling that the company has its thumb on the scales in order to disadvantage its own partners, so it’s launching an investigation.

The suspected foul play takes two forms. Firstly the EC thinks Amazon mines the non-public business data of its partners to give itself unique insight into market trends and that sort of thing, thus giving it an unfair advantage over them. Not content with just one piece of cheating, Amazon may also be guilty of favouring third parties that use its own logistics and delivery services over those that do it themselves.

“We must ensure that dual role platforms with market power, such as Amazon, do not distort competition,” said EC Executive Vice-President Margrethe Vestager (pictured). “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 e-commerce booming, and Amazon being the leading e-commerce platform, a fair and undistorted access to consumers online is important for all sellers.”

Amazon will presumably insist this is all a big misunderstanding and that it would never dream abusing its position as the western world’s dominant etailer, but recent reports suggest the contrary. The in-depth investigation will now proceed at the EC’s usual glacial pace, but it looks like Amazon will do well to escape a hefty fine at the very least.