Amazon will reportedly make changes to its business practices to resolve two European antitrust investigations next week.
The European Commission announced competition investigations in July 2019 and November 2020 examining Amazon’s use of non-public data from independent merchants who sell goods through its e-commerce platform.
The investigations have focused on Amazon’s dual role, as a retailer and as the operator of a marketplace for retailers in which it participates. The commission’s concern is that “Amazon appears to use competitively sensitive information – about marketplace sellers, their products and transactions on the marketplace” to gain advantage over other market participants.
According to The New York Times and The Financial Times, Amazon has agreed to a settlement scheduled for disclosure on December 20, 2022. The settlement, it’s said, is substantially similar to the draft commitments [PDF] proposed by Amazon in July and presented for public comment.
Amazon reportedly will agree not to use non-public data to compete with its sellers. That is to say, Amazon won’t be able to drill into the stats it privately holds on its merchants to undercut or outmaneuver them in Amazon’s marketplace.
Sellers will be allowed to participate in Amazon Prime without using Amazon’s logistics service for shipping. And they will also be afforded equal access to valuable screen space, which affects product visibility and thus sales.
One reason for the settlement is believed to be Europe’s adoption of the Digital Services Act and the Digital Markets Act, which were agreed to in March and April respectively and took effect last month. Under these new rules, which aim to protect the rights of people using digital services and to promote competition by limiting the power of online gatekeepers, Amazon could potentially be fined up to 10 percent of its annual revenue for rules violations.
These legislative changes have also got the attention of other large tech firms. Apple, for example, is said to be preparing to allow third-party app stores for iOS devices next year as a consequence of the DMA.
In the US, lawmakers have been unable to pass recently proposed bills to promote competition and limit self-preferencing among large tech firms. Efforts to rein in Big Tech have largely occurred at the state level, such as California’s competition lawsuit against Amazon in September and various state complaints against Google.
Federal agencies such as the FTC have periodically tried to bring large tech firms to heel but the penalties imposed have been insufficient to really change anything.
In a statement to The Register, an Amazon spokesperson did not respond to our request to confirm the reported settlement but reiterated the company’s past reservations about the new EU regulations while maintaining that it has engaged with regulators in good faith.
“While we have serious concerns about the Digital Markets Act unfairly targeting Amazon and a few other US companies, and disagree with several conclusions the European Commission made, we have engaged constructively with the Commission to address their concerns and preserve our ability to serve European customers and the more than 225,000 European small and medium-sized businesses selling through our stores,” Amazon’s spokesperson said.
“No company cares more about small businesses or has done more to support them over the past two decades than Amazon.” ®
