The US Federal Trade Commission (FTC) has filed a lawsuit against Amazon, alleging that the company has been engaging in a number of “interlocking anticompetitive and unfair strategies to illegally maintain its monopoly power.”
In the complaint, the FTC and 17 state attorneys general claim that Amazon’s actions have prevented its rivals and sellers from lowering prices, leading to a decrease in quality for shoppers, sellers being overcharged, innovation being stifled, and Amazon’s market competitors prevented from fairly competing against the company.
Amazon hasn’t violated the law because of its size but rather because its exclusionary conduct prevents current competitors from growing and new ones from emerging, the FTC alleges. It claims Amazon’s anticompetitive conduct has occurred in both its online shopping market that serves buyers, and its online marketplace that serves sellers.
“We’re bringing this case because Amazon’s illegal conduct has stifled competition across a huge swath of the online economy. Amazon is a monopolist that uses its power to hike prices on American shoppers and charge sky-high fees on hundreds of thousands of online sellers,” said John Newman, deputy director of the FTC’s bureau of competition, in a statement.
A core issue of the lawsuit is Amazon’s practice of steadily increasing fulfillment fees for sellers on the tech giant’s e-commerce platform, which the FTC says forces them to raise prices for customers. The FTC also notes that the company effectively punishes sellers that offer products for sale on other platforms at prices that are lower those on Amazon, and that punishment can include removal from the Amazon site.
After the FTC filed the lawsuit, Amazon’s senior vice president, global public policy and general counsel, David Zapolsky, posted an update on X, the social media platform formerly known as Twitter, stating that Amazon believes the FTC’s lawsuit is “misguided.”
“Unfortunately, it appears the current FTC is radically departing from that approach, filing a misguided lawsuit against Amazon that would, if successful, force Amazon to engage in practices that actually harm consumers and the many businesses that sell in our store,” the company wrote in a statement, going on to rebut the allegations laid out by the regulator.
“We fundamentally disagree with the FTC’s allegations… We will contest this lawsuit,” the statement said.
Although the FTC did not explicitly say that it would seek to break up Amazon, it did include a request for “structural relief,” noted David Olson, associate professor at Boston College Law School. If the FTC prevails, it could mean “the court would order some change in the structure of Amazon, such as not running Amazon Marketplace and also competing there, or spinning off its fulfilment operation into a separate, unrelated business,” Olson said.
Amazon is also facing an anticompetition probe in the UK…
2023-09-27 18:48:02
Original from www.computerworld.com rnrn
