After years of investigations and tensions between political forces and Amazon, the US Federal Trade Commission (FTC) and 17 states filed a complaint against the tech giant on Tuesday, accusing it of “illegally maintaining its monopoly” through “anti-competitive and unfair policies.” .
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“It’s not about Amazon’s size,” the FTC clarified in a press release, but about “illegal practices designed to exclude competitors, prevent them from developing, and prevent alternatives from emerging.”
For example, according to the federal agency, Amazon prevents sellers from offering lower prices than their own on products where the Seattle group competes with retailers.
The agency also criticizes the American giant for making merchants’ eligibility for Prime (a subscription that allows consumers fast delivery) dependent on the use of Amazon’s “expensive” logistics services.
“Amazon is exploiting its monopoly power to enrich itself while simultaneously driving up prices and reducing service to the millions of American families who shop on its platform and the hundreds of thousands of businesses that rely on Amazon to market their products are deteriorated,” the company claims. FTC President Lina Khan is quoted in the press release.
“The complaint filed today clearly shows that the FTC has radically departed from its mission to protect consumers and protect competition,” Amazon Vice President David Zapolsky responded in an online statement.
“Astonishing contempt”
He assures that, on the contrary, the practices criticized by the authority “have contributed to stimulating competition and innovation throughout the retail sector, making it possible to offer Amazon customers greater choice, lower prices, lower prices and shorter delivery times.”
The American group, which reported sales of $134.4 billion in the second quarter of this year and a net profit of $6.7 billion, regularly highlights the increase in sales of merchants on its platform.
In 2022, “more than 60% of sales on Amazon came from independent sellers, most of whom are small and medium-sized businesses,” the company said last month.
If the FTC wins, “it will force Amazon to take actions that harm consumers and SMBs,” assures David Zapolsky.
But for many NGOs and SMEs, on the contrary, there is an unfavorable balance of power.
“SMEs have been waiting for this moment for a very long time,” Stacy Mitchell, co-director of the Institute for Local Self-Reliance, which promotes local and environmentally friendly consumption, commented on Tuesday.
“By controlling market access, Amazon can favor its own products when necessary and spy on companies by stealing their best ideas and data. She can dictate her laws and rule with astonishing contempt. One day she offers a seller the “delivery within 24 hours” option. The next day she suspended her account, completely wiping out her sales.
According to Insider Intelligence, the platform accounts for 37.6% of online sales in the US, well ahead of Walmart supermarkets (6.8%), Apple (3.5%) and eBay (3.1%).
impartiality
Many American elected officials and Joe Biden’s Democratic administration have been trying to fight the tech giants’ “monopolies” for years, without success.
This summer, after a series of legal setbacks, the FTC was forced to suspend its proceedings to block Microsoft’s acquisition of Activision Blizzard (video games).
Lina Khan, chairwoman of the FTC since 2021, became known as a student with an article entitled “The Amazon Antitrust Paradox” published in the Yale University Law Review in 2017.
She believed that America’s legislative arsenal was insufficient to combat the monopolistic practices of groups like Amazon.
In June 2021, the company filed a complaint with the FTC, accusing its manager of a 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 “tricking consumers” with its auto-renewing Prime subscription that is “complicated” to cancel.
The institution also attacked the group for respecting the confidentiality of data. Last May, Amazon agreed to pay more than $30 million to drop lawsuits against Ring and Alexa (connected doorbells and speakers, security cameras), two product lines that collect a lot of information about their users.