“Big tech” targeted again. After years of investigations into Amazon, and tensions between political powers and the online commerce platform, the American competition authority, the FTC, and 17 states filed a complaint on Tuesday against the technology giant, which they accuse of “illegally maintain its monopoly” through “anti-competitive and unfair strategies”. A decision that falls during the Google trialalso prosecuted for violating antitrust law.
“It is not the size of Amazon that is at issue”, specifies the institution in a press release, but its “illegal methods which aim to exclude competitors, to prevent them from developing and alternatives from emerging “.
According to the FTC, Amazon, for example, discourages sellers from offering lower prices than its own on products where the Seattle group competes with retailers. The authority also criticizes the American giant for making merchants’ eligibility for “Prime” (a subscription which allows consumers to have them delivered quickly) conditional on the use of Amazon’s “expensive” logistics services.
Amazon accused of raising prices
“Amazon is exploiting its monopoly power to enrich itself, while driving up prices and degrading service for the tens of millions of American families who shop on its platform and the hundreds of thousands of companies that depend on Amazon” to market their products, asserts the president of the FTC, Lina Khan, quoted in the press release.
“The complaint filed today clearly shows that the FTC has radically departed from its mission to protect consumers and competition,” responded David Zapolsky, a vice president of Amazon, in a statement to the press.
He assures that the practices questioned by the authority have on the contrary “contributed to stimulating competition and innovation throughout the retail sector, and have made it possible to offer greater choice, lower prices lower prices and faster delivery times to Amazon customers, as well as greater opportunities for the many businesses that sell in Amazon’s store.
A long-awaited complaint
The American group, which achieved $134.4 billion in turnover and generated a net profit of $6.7 billion in the second quarter of this year, regularly highlights the increase in sales made by merchants on its platform.
In 2022, “more than 60% of sales on Amazon came from independent sellers, the majority of whom are small and medium-sized businesses,” the company highlighted last month.
But for many NGOs, SMEs suffer from the unfavorable balance of power with the giant. “SMEs have been waiting for this moment (the FTC complaint) for a very long time,” commented Tuesday Stacy Mitchell, co-director of the Institute for Local Self-Reliance, which campaigns for local and environmentally friendly consumption.
“By controlling access to the market, Amazon can favor its own products if it wishes, spying on companies by stealing their best ideas and their data. She can dictate her law and govern with astonishing contempt. One day, she gives a seller the “delivery within 24 hours” option. The next day, she suspended her account, completely wiping out her sales.”
“Amazon Antitrust Paradox”
Many American elected officials, and the Democratic government of Joe Biden, have been trying for years to bring technology giants, regularly accused of abusing their dominant position in their respective sectors, into line. Relations between the organization and Amazon are particularly tense.
The lawyer Lina Khan, president of the FTC since 2021, made herself known in the academic world when she was still a student, by publishing in 2017 an article entitled “The antitrust paradox of Amazon” in the law review of the Yale University.
She considered that the American legislative arsenal was insufficient to fight against the monopolistic practices of groups like Amazon. In June 2021, the company submitted a complaint to the FTC, asking it to ensure that its manager does not handle antitrust matters concerning it, and accusing her of her lack of impartiality.
But that hasn’t stopped the federal agency from moving forward on several fronts. Last June, the FTC filed a complaint against Amazon for having “trapped consumers” with its Prime subscription, which renews automatically and is “complicated” to cancel.
The institution also attacked the group over respect for data confidentiality. Last May, Amazon agreed to pay more than $30 million to end lawsuits against Ring and Alexa (connected doorbells and speakers, security cameras), two product lines that collect a lot of information about their users.
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