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Amazon Agrees to Major Business Changes in the EU to Head Off Probe

Amazon has reached an agreement with the EU to make major changes to its business in exchange for heading off antitrust probes....
Amazon Agrees to Major Business Changes in the EU to Head Off Probe
Written by Matt Milano
  • Amazon has reached an agreement with the EU to make major changes to its business in exchange for heading off antitrust probes.

    Amazon was under fire for dealing unfairly with third-party sellers, preferring its own retail business over those of competitors, as well as for using its sellers’ non-public data to fine-tune its own services and gain an advantage.

    The EU Commission outlined its concerns in a statement:

    In July 2019, the Commission opened a formal investigation into Amazon’s use of non-public data of its marketplace sellers. On 10 November 2020, the Commission adopted a Statement of Objections in which it preliminarily found Amazon dominant on the French and German markets, for the provision of online marketplace services to third-party sellers. It also found that that Amazon’s reliance on marketplace sellers’ non-public business data to calibrate its retail decisions, distorted fair competition on its platform and prevented effective competition.

    In parallel, on 10 November 2020, the Commission opened a second investigation to assess whether the criteria that Amazon sets to select the winner of the Buy Box and to enable sellers to offer products under its Prime Programme, lead to preferential treatment of Amazon’s retail business or of the sellers that use Amazon’s logistics and delivery services.

    As part of the agreement, Amazon will no longer use non-public data from its sellers to improve its own products. The company will also make offers and products from competing sellers equally visible in its “Buy Box.” The terms of the deal will be enforced for seven years, but will only be in effect within the EU.

    “Today‚Äôs decision sets new rules for how Amazon operates its business in Europe,” said Margrethe Vestager, Executive Vice-President in charge of competition policy. “Amazon can no longer abuse its dual role and will have to change several business practices. They cover the use of data, the selection of sellers in the Buy Box and the conditions of access to the Amazon Prime Programme. Competing independent retailers and carriers as well as consumers will benefit from these changes opening up new opportunities and choice.

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