Amazon and EU reach agreement to end antitrust investigation
Amazon has agreed to give merchants operating in the European Union greater access to valuable real estate on its website, the European Commission said on Tuesday, in a deal that ends antitrust investigations by regulators who said that the company had used its size and power to stifle competition in the bloc.
The settlement helps Amazon avoid what could have been a multi-billion dollar fine, while giving the European Commission, the executive arm of the European Union, a victory by making long-sought changes to the platform. dominating online shopping in the world. As part of the deal, the company will also be prohibited from using nonpublic information it collects about independent merchants to inform Amazon’s own product choices.
The deal is an attempt to put more checks and balances between Amazon’s roles as a digital storefront that many merchants depend on to reach customers and as a maker of products that often compete with those outside sellers. Critics say the dual role has created a conflict of interest, allowing Amazon to favor its own products and services over smaller rivals who have few other ways to reach customers online.
“Today’s decision sets new rules for how Amazon does business in Europe,” said Margrethe Vestager, executive vice president of the European Commission who oversees digital policy and antitrust enforcement. “Amazon can no longer abuse its dual role and will have to change several business practices.”
She added: “Competitive independent retailers and carriers as well as consumers will benefit.”
An Amazon spokesperson said the company was “pleased that we have addressed the European Commission’s concerns.”
“While we continue to disagree with several of the European Commission’s preliminary findings,” the spokesperson said, “we have engaged constructively to ensure we can continue to serve customers across Europe. and supporting the 225,000 European small and medium-sized businesses selling in our stores.
Already considered the most active regulator of the tech industry in the world, the European Union is now acting even more aggressively. On Monday, antitrust regulators filed charges against Meta that could result in billions of dollars in fines for anticompetitive practices related to its marketplace service for the sale of goods. Apple and Google are also being investigated for possible antitrust violations.
Companies are also rushing to comply with new EU laws that target the tech sector and come into force by 2024. The rules give regulators even more power to crack down on what are seen as business practices anti-competitive rules and require social media companies to control user-generated content. more actively.
The deal with Amazon announced on Tuesday closely follows a preliminary agreement announced in July. As part of the settlement, Amazon agreed to:
Give independent merchants equal access to the Buy Box – the shopping area with prominent buttons on a product’s listing that prompt customers to “Buy Now” or “Add to Cart”. Amazon said it would create a second offer box if there was enough of a difference in price or delivery time.
Stop using non-public data about merchants selling on its website, including terms of sale, revenue, and inventory, which Amazon may use to make decisions about which competing products to create, sell, and promote.
Allow external sellers to participate in Amazon’s Prime program even if they do not use Amazon’s logistics business, if they meet certain delivery and service reliability standards.
The settlement lasts for five years and only legally applies to Amazon’s operations in the European Union.