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Amazon faces EU antitrust probe over use of data from smaller traders

The European Commission will assess Amazon's 'dual role' as a retailer and host to other sellers.

Aoife White | Bloomberg 

Amazon India is the country's most attractive employer brand, says survey Inc. becomes the latest U.S technology giant targeted by European Union antitrust chief Margrethe Vestager as the watchdog opened a probe into suspicions the retailer misuses data from smaller traders.

The European Commission will assess the company’s "dual role" as a retailer and host to other sellers, the authority said in an emailed statement on Wednesday. Ramping up scrutiny first mentioned last year allows officials to start to build a case that could ultimately lead to fines or an order to change the way the Seattle-based company operates.

"Amazon appears to use competitively sensitive information -- about marketplace sellers, their products and transactions," the EU said. Officials will check whether Amazon as a retailer in its own right benefits from sales it sees by smaller rivals. It will also look at how Amazon selects winners of the ‘best buy’ box which "seems key for marketplace sellers as a vast majority of transactions are done through it."

Vestager has flagged the probe in recent months, saying regulators have gathered huge amounts of data for the probe amid concerns that online firms are becoming gatekeepers, monopolizing information that could also be a key resource for others. Retailers were quizzed last year on whether Amazon unfairly copies popular products before starting its own-brand version, such as the Amazon Basics line.

Amazon said it "will cooperate fully with the European Commission and continue working hard to support businesses of all sizes and help them grow."

Vestager has already slapped Google with record fines and ordered Apple Inc. to repay billions of euros in back taxes. By taking on Amazon’s Chief Executive Officer Jeff Bezos, Vestager is keeping up the pressure on big tech right to the very end of her mandate, due to expire in October.

While it will be the first time the EU has directly targeted Amazon’s online retail business model, it’s the third time the company has been probed by the regulator, following tax and e-book investigations.

Amazon separately struck a deal with Germany and Austria to shut down antitrust probes into terms for sellers, according to statements on Wednesday. It will make changes to its business services agreement worldwide from Aug. 16 to address complaints about liability provisions, contract clauses and blocking and selling users accounts.

(With assistance from Christopher Elser.)

First Published: Wed, July 17 2019. 22:31 IST