The European Commission's Margrethe Vestager announced a statement of objection to Amazon's practices Tuesday, which focus on how the platform uses third-party merchant data to compete against those merchants with its own-label products.
"Amazon illegally abused its dominant position as a marketplace service provider in Germany and France," Vestager said in a press conference. In a statement, the Commission said its preliminary view is that "the use of non-public marketplace seller data allows Amazon to avoid the normal risks of retail competition." It accused Amazon of using "very large quantities of non-public seller data … to calibrate Amazon's retail offers and strategic business decisions to the detriment of the other marketplace sellers."
Alongside the statement of objection, the Commission announced an investigation into Amazon's "buy box." Initial investigations, Vestager said, found that "Amazon may have set certain rules on its platform that artificially favors both its own retail offers, as well as the offers of sellers that use Amazon's logistics and delivery services."
"Our concern is that Amazon may artificially push retailers to use its own related services," she added. Specifically, the Commission is concerned that Amazon uses its buy box to pressure third-party sellers into using Amazon's fulfillment services, and the investigation seeks to ascertain if that actually is the case.
Amazon did not immediately respond to a request for comment. It now has the chance to respond to the Commission's statement of objection before the Commission makes a final decision and potentially fines the company or forces it to change its practices.
Shakeel Hashim (
@shakeelhashim) is a growth manager at Protocol, based in London. He was previously an analyst at Finimize covering business and economics, and a digital journalist at News UK. His writing has appeared in The Economist and its book, Uncommon Knowledge.