Amazon settles antitrust probes in EU to evade fines

01 Amazon Logo box DG AH 2021

Amazon has settled two antitrust probes in the EU that were launched by the European Commission’s antitrust watchdog over using seller’s data to gain an unfair advantage. Settling these cases prevents Amazon from paying hefty fines.

Back in 2019, the European watchdog launched a probe into Amazon’s business practices in the region. The giant retailer reportedly used seller’s data to adjust its strategies in major European markets like France and Germany. The European Commission identified this act as an antitrust violation and said Amazon has “distorted fair competition on its platform and prevented effective competition.”

Amazon could face a fine of tens of millions of dollars if it failed to settle cases. To prevent further conflict, Amazon promised that it would no longer use the seller’s data for its own benefit. Also, data won’t be used for selling Amazon’s private label products.

Amazon settles two antitrust cases in Europe

The European Commission also launched a probe into how Amazon ranks and shows sellers in the “buy box” tool and Prime. Additionally, whether the giant retailer gives any advantages to the sellers that use its facilities and delivery services. The Buy Box feature is also the cause of a class action lawsuit in the UK that might make Amazon pay £900m ($997m) in fines.

Amazon has now agreed to “display a second competing offer to the Buy Box winner if there is a second offer from a different seller that is sufficiently differentiated from the first one on price and/or delivery.”

The company should also ensure that there will be no discrimination against Prime sellers. Also, Prime members will be free to choose their favorite delivery service.

Amazon will stay under the European Commission’s radar for seven years. This is so the EC can ensure that the company fulfills its commitments toward Buy Box and Prime. Additionally, the commitment to not using sellers’ data keeps Amazon under the radar for five years. In case of breaking the commitments, Amazon might face a fine of up to 10% of its annual global turnover. That’s close to $47 billion.

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