Amazon Under EU Antitrust Fire Over Use of Merchant Data

The EU investigation will focus on Amazon's standard agreements with marketplace sellers.

Advertisement
By Reuters | Updated: 18 July 2019 11:13 IST

Amazon's use of merchants' data triggered an EU antitrust investigation on Wednesday, as regulatory concerns mount around the world on how tech giants exploit customer information to reinforce their market power.

US tech firms Amazon, Google, and Facebook have been in the regulatory spotlight as antitrust enforcers examine how they use data to shut out rivals. Some US politicians and even one of Facebook's co-founders have called for them to be broken up.

Advertisement

The European Commission has been seeking feedback from retailers and manufacturers since September into Amazon's dual role as a marketplace for merchants and as a competitor, following complaints from traders about Amazon's practices.

The Commission said its investigation would look into Amazon's data agreements with marketplace sellers and how the online retailer uses that data to choose which seller is selected to provide a product once a consumer clicks "buy."

Advertisement

European Competition Commissioner Margrethe Vestager, who can fine companies up to 10% of their global turnover and force them to change their business practices, said the issue was crucial as increasing numbers of Europeans shop online.

"E-commerce has boosted retail competition and brought more choice and better prices. We need to ensure that large online platforms don't eliminate these benefits through anti-competitive behaviour," she said.

Advertisement

Amazon said it would cooperate fully with the EU investigation. The company reached a deal with Germany's antitrust authority on Wednesday to overhaul its terms of service for third-party merchants.

Its shares were 0.6% down versus a 0.1 percent rise in the Dow Jones US Technology Index.

Advertisement

Under Amazon's terms of service for Europe set out on its website, merchants grant Amazon "royalty-free" rights to use their materials, such as technology, trademarks, content and product information.

The Commission may take a tougher approach this time to set a precedent for other platforms providing a marketplace whilst competing with their own products, said Ioannis Lianos, professor of global competition law and public policy at University College London.

"I think the Commission will want to give a strong message because it's one of the first cases to bring this issue," Lianos said. "My feeling is that the Commission's interest is not to settle but to take an infringement decision to lay down the law clearly and set a precedent."

In Washington, the US Federal Trade Commission is contemplating probes of Amazon and Facebook while the Justice Department is looking at Apple and Google.

In Congress on Tuesday, Representative David Cicilline, chair of the Judiciary Committee's antitrust subcommittee, pressed Nate Sutton, an associate general counsel at Amazon, about whether the online retailer used data about independent sellers on its platform to develop products to sell, thus competing against its own sellers.

Sutton argued that the data was used solely to know what to offer customers. "The algorithms are optimised to what customers want to buy regardless of the seller," he said.

This would not be Amazon's first run-in with the Commission. Two years ago, it was told to pay back taxes of about EUR 250 million ($280 million) to Luxembourg because of illegal tax benefits. That same year it settled with the regulator over its distribution deals with e-book publishers in Europe.

© Thomson Reuters 2019

 

Get your daily dose of tech news, reviews, and insights, in under 80 characters on Gadgets 360 Turbo. Connect with fellow tech lovers on our Forum. Follow us on X, Facebook, WhatsApp, Threads and Google News for instant updates. Catch all the action on our YouTube channel.

Further reading: Amazon, EU
Advertisement

Related Stories

Popular Mobile Brands
  1. These OnePlus Smartphones Could Receive the ColorOS 17 Update in India
  2. OnePlus N6x Design, Colour Options Teased Ahead of India Launch
  3. Redmi Note 17 Pro Max Listed on NBTC Website Ahead of Imminent Launch
  4. Samsung Galaxy Z Fold 8 Ultra Could Cost More Than Expected, Listing Suggests
  5. Tecno Camon 50 Ultra 5G Sale Begins in India Today
  1. Offline UPI Payments With NFC Support Could Launch in India Soon
  2. Samsung Galaxy S26 Ultra's Privacy Display Feature Gets a Major Upgrade in One UI 9 Beta
  3. OnePlus N6x Design, Colour Options Teased in New Marketing Material Ahead of Imminent Launch in India
  4. OnePlus 11, Nord 4, and Newer Models Tipped to Receive the Android 17-Based ColorOS 17 Update in India
  5. Redmi Note 17 Pro Max Appears on Thailand's NBTC Certification Database, Might Launch Soon
  6. Apple’s First Foldable iPhone Reportedly Appears in iOS 27 Beta Code With a Multi-Battery Setup
  7. X for Android App Undergoes Major Design Overhaul, Enhanced Performance and Reliability
  8. Samsung Galaxy Buds Able to Reportedly Skip Galaxy Unpacked Launch; Could Debut in October
  9. Dell Alienware 16X Aurora, Alienware 16 Area-51 and Alienware 18 Area-51 Launched in India: Price, Specifications
  10. Samsung Galaxy A55, Galaxy A35 One UI 9 Test Builds Reportedly Spotted Ahead of Android 17 Rollout
Download Our Apps
Available in Hindi
© Copyright Red Pixels Ventures Limited 2026. All rights reserved.