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Amazon Faces New Antitrust Probes Over Alleged Abuse of Power

Amazon’s treatment of third-party sellers is back in the spotlight.

The e-commerce giant has found itself at the center of two antitrust probes in California and Washington states, where investigators are looking into whether it had used its marketplace to benefit its own products versus those of third-party merchants.

According to reports from The New York Times and The Wall Street Journal, the inquiries are focused on Amazon’s purported use of data to  inform the items it sells and whether or not the company has made it more difficult for third-party vendors to sell competing products on the site.

Amazon has previously indicated that its in-house products account for only about 1% of its total annual retail sales. The Seattle-based retailer did not immediately respond to FN’s request for comment but has said on multiple occasions, including in testimony given under oath at a congressional hearing last July, that it does not use third-party sellers’ data to make decisions regarding private-label offerings.

The reports come just days after the European Union was said to have been planning formal antitrust charges against Amazon. On Thursday, citing people familiar with the matter, the WSJ noted that the charges — which would mark the EU’s first set of formal antitrust claims against Amazon — could be filed as early as this week or next.

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The European Commission, the executive branch of the EU, has reportedly been circulating a draft of charges against the retailer for the past couple of months. It comes during a nearly two-year investigation into Amazon’s alleged mistreatment of third-party merchants.

The majority, or 58%, of sales on Amazon comes from third parties, but concerns have been raised regarding the amount of data it can access. Common among department stores, big-box chains and supermarkets, in-house brands typically generate higher profit margins for retailers than wholesale goods. In recent years, Amazon has pushed to increase its private label offerings: As of 2019, the retailer had 140 private-label brands — up from just 27 in 2017 — along with 511 exclusive brands, according to TJI Research, which provides information and analysis about the online behemoth.

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