Amazon probed by CMA for ‘weakening competition’

// Amazon is being probed by the CMA for allegedly being anti-competitive
// The watchdog is investigating whether Amazon is giving an unfair advantage to its own retail business or sellers that use its services

Amazon is under investigation over concerns that some of its practices in the UK may result in a worse deal for customers.

The CMA is probing the retailer on whether it is being anti-competitive by giving an unfair advantage to its own retail business or sellers that use its services, compared with other third-party sellers.

The investigation will also look at how Amazon is using third-party seller data and how it decides the criteria for selling under the Prime label.

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The watchdog will also find out how Amazon selects the preferred choice in the “Buy Box”, which is featured on Amazon’s product pages.

It provides customers with one-click options to “Buy Now” or “Add to Basket” from a specific seller.

“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,” CMA general counsel Sarah Cardell said.

“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.”

An Amazon spokesperson told Retail Gazette: “We will work closely with the CMA during their investigation, although we believe we’ve always worked hard to help small businesses selling on Amazon to succeed, which is in both their and our best interests.

“We remain proud of the continued support we provide to businesses of all sizes across the UK. More than 50% of all products sold on Amazon are from small businesses, and sales from our selling partners continue to grow faster than Amazon’s retail sales.

“There are now more than 65,000 small and medium-sized business in the UK that sell on Amazon, supporting more than 175,000 jobs across the country.”

The CMA will also aim to communicate with the European Commission, which has been looking into similar concerns in the EU.

In 2020, EU regulators charged Amazon with breaking antitrust rules, alleging that it was collecting data from independent companies that sell through its marketplace and then using it to benefit its own retail business.

Information collected was said to include the number of products ordered and shipped, sellers’ revenues on the marketplace, the number of visits to sellers’ offers and sellers’ past performance.

The data allowed Amazon to adjust its offers accordingly, the European Commission claimed.

A second EU investigation was opened to examine whether Amazon was giving preferential treatment to its own offers and those of sellers using its logistics and delivery services.

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