THE WHAT? The Competition and Markets Authority (CMA) is investigating Amazon over concerns that practices affecting sellers on its UK Marketplace may be anti-competitive and could result in a worse deal for customers.
THE DETAILS Some products on Amazon Marketplace are supplied via its own retail business, however the CMA states that a large proportion are supplied by third-party sellers.
The CMA investigation will, “consider whether Amazon has a dominant position in the UK and whether it is abusing that position and distorting competition by giving an unfair advantage to its own retail business or sellers that use its services, compared to other third-party sellers on the Amazon UK Marketplace.”
It will focus on three main areas, including how Amazon collects and uses third-party seller data, how Amazon sets criteria for allocation of suppliers to be the preferred/first choice in the ‘Buy Box,’ and how Amazon sets the eligibility criteria for selling under the Prime label.
THE WHY? Sarah Cardell, General Counsel at the CMA, said, “Millions of people across the UK rely on Amazon’s services for fast delivery of all types of products at the click of a button. This is an important area so it’s right that we carefully investigate whether Amazon is using third-party data to give an unfair boost to its own retail business and whether it favours sellers who use its logistics and delivery services – both of which could weaken competition.
“Thousands of UK businesses use Amazon to sell their products and it is important they are able to operate in a competitive market. Any loss of competition is a loss to consumers and could lead to them paying more for products, being offered lower quality items or having less choice.
“A formal investigation will allow us to consider this matter properly.”