Amazon has finalised a deal with EU antitrust regulators to settle concerns that its use of non-public data undermines rivals, announcing new measures to level the playing field for sellers in its marketplace.
Through the agreement announced on Tuesday the US tech giant will treat all sellers equally and make rival products more visible on Amazon’s “buy box”, which generates the majority of purchases on the site.
Amazon will also create a second buy box, which will display alternative offers for consumers who decide that speed of delivery is less important to them.
The deal ends two long-running probes into the $866 billion (€814 billion) company and represents a victory for the EU as it will serve as a blueprint for compliance with the new Digital Markets Act, a landmark piece of legislation aimed at curbing the power of Big Tech.
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“Amazon can no longer abuse its dual role and will have to change several business practices,” said Margrethe Vestager, the EU’s competition chief. “Competing independent retailers and carriers as well as consumers will benefit from these changes opening up new opportunities and choice.”
The agreement will change many of Amazon’s long-running business practices. Sellers using the Amazon Prime membership scheme will also be able to choose any logistics company and negotiate their contracts directly instead of being locked into using Amazon’s logistics services.
These commitments are legally binding, will remain in force for between five and seven years and have been agreed with EU officials after nearly three years of investigation.
By introducing these measures, Amazon has avoided formal charges of breaking EU law and a potential fine of up to 10 per cent of global revenues.
If Amazon breaches the commitments, the commission could enforce this fine without having to find an infringement of antitrust rules. Alternatively, regulators could impose a periodic penalty payment of 5 per cent per day of Amazon’s daily turnover for every day of noncompliance.
“We are pleased that we have addressed the European Commission’s concerns and resolved these matters,” Amazon said.
The company added that it disagreed with several of the preliminary conclusions the European Commission had made and had engaged constructively to ensure it could continue to serve customers across Europe.
Under the Digital Markets Act, which came into force in November, legislation requires large platforms to give equal treatment to data. It prohibits self-preferential treatment, such as when a company might prioritise its products in searches above rivals on its online marketplace.
Facebook owner Meta was served with a complaint from the EU’s antitrust watchdog on Monday over concerns that the social network’s classified advert service is unfair to rivals.
By automatically giving its users access to Facebook Marketplace, the network’s platform for buying and selling goods, the social network has “a substantial distribution advantage that competitors cannot match”, the European Commission said.
Meta said the claims were without foundation and it would work with authorities to challenge them. – Copyright The Financial Times Limited 2022
