It is well known, that Amazon’s retail decisions are most driven by automated systems and Amazon has a dual role as a platform. It is a marketplace, and it sells products on its platform as a retailer. In this dual position, Amazon has access to large amounts of data about the independent sellers and their activities on its platform.
Maria
Last Updated on 21 July 2022In July, the European Commission has opened a formal investigation to assess whether Amazon’s use of non-public data from independent retailers selling in its marketplace breached EU competition rules.
Later, in November, a statement of objections was issued. It was outlining its view that Amazon should not rely on independent sellers` business data in order to calibrate its retail decision, because this prevents effective competition on the platform.
Parallelly, a second investigation was opened by the EU Commission. It was investigating the Amazon’s Buy Box and the Amazon’s Prime program. This investigation led to a finding that the rules and criteria for the Buy Box and Prime unduly favor Amazon’s own retail business and the business of the marketplace sellers that use Amazon’s logistics and delivery services. This may harm other marketplace sellers, their independent carriers, other marketplaces, as well as consumers that may not get to view the best deals.
Amazon therefore has offered the following commitments:
Concerning Marketplace seller data:
- Amazon commits to refrain from using non-public data relating to, or derived from, the activities of independent sellers on its marketplace, for its retail business that competes with those sellers. This would apply to both Amazon’s automated tools and employees that could cross-use the data from Amazon Marketplace, for the purposes of retail decisions. The relevant data would cover both individual and aggregate data, such as sales terms, revenues, shipments, inventory related information, consumer visit data or seller performance on the platform.
- Amazon commits not to use such data for the purposes of selling branded goods as well as its private label products.
Concerning Buy Box Amazon:
- Amazon commits to apply equal treatment to all sellers when ranking their offers for the purposes of the selection of the winner of the Buy Box;
- Amazon commits to display a second competing offer to the Buy Box winner if there is a second offer that is sufficiently differentiated from the first one on price and/or delivery. Both offers will display the same descriptive information and provide for the same purchasing experience. This will enhance consumer choice.
Concerning Prime Amazon:
- Amazon commits to set non-discriminatory conditions and criteria for the qualification of marketplace sellers and offers to Prime;
- Amazon commits to allow Prime sellers to freely choose any carrier for their logistics and delivery services and negotiate terms directly with the carrier of their choice;
- Amazon commits not to use any information obtained through Prime about the terms and performance of third-party carriers, for its own logistics services. This is to ensure that carriers’ data is not flowing directly to Amazon’s competing logistics services.
The above-mentioned commitments cover all Amazon’s current and future marketplaces in the European Economic Area. Here some additional important information:
- Italy is excluded from the commitments related to Buy Box and Prime in view of the decision of 30 November 2021 of the Italian competition authority which already imposed remedies on Amazon with regard to the Italian market.
- The commitments would remain in force for five years.
- The implementation of those commitments would be monitored by a monitoring trustee who would report regularly to the Commission.
- A summary of the proposed commitments will be published in the EU’s Official Journal. The full text of the commitments will be available on DG Competition’s website.
For more information on this topic or if you want to leave your feedback to the European Commission, please go to the website of the commission.
