BRUSSELS: July 18, 2019. The European Commission has told Amazon it is investigating whether the company’s use of data from independent retailers who sell their products via its marketplace is in breach of EU competition rules.
"European consumers are increasingly shopping 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,” said European Competition Commissioner Margrethe Vestager.
“I have therefore decided to take a very close look at Amazon's business practices and its dual role as marketplace and retailer, to assess its compliance with EU competition rules.”
When providing a marketplace for independent sellers, Amazon continuously collects data about the activity on its platform. Based on the Commission's preliminary conclusions it says Amazon “appears to use competitively sensitive information – about marketplace sellers, their products and transactions on the marketplace”.
“As a matter of priority”, the Commission is now going to investigate the agreements between Amazon and its marketplace sellers that allow the company’s retail business to analyse and use such data, and determine what impact it has on competition.
The move coincides with an agreement “in principle” by G7 Finance ministers and central bankers meeting in Chantilly, France this week “to tax activities without physical presence, in particular digital activities," according to French Finance minister Bruno Le Maire.
Earlier this month the French Parliament passed a law to collect e-commerce sales tax from Google, Apple, Facebook and Amazon despite discrimination complaints by the US. Now outgoing UK Chancellor Phillip Hammond, who also attended the G7 meeting, wants to apply a similar tax in Britain.
According to David Jinks, head of Consumer Services at UK delivery company Parcel Hero, Hammond’s “Amazon Tax” will apply to international search engines, social media platforms and online marketplaces with a global revenue of £500 million and UK revenues of more than £25 million.
“No global company is going to lie back and lose this kind of money without putting up its prices to compensate. It will be the online shopper who pays the price, not commercial giants such as Facebook or Amazon,” claimed Jinks.
