European Regulators Say Amazon Breached Rules

European Regulators Say Amazon Breached Rules

over 3 years ago2 mins

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If you like European regulators, you might also like... their announcement on Tuesday that Amazon is in breach of anti-competition rules 🇪🇺

What does this mean?

The European Commission – a branch of the European Union that manages the bloc’s day-to-day business – started investigating Amazon’s anticompetitive behavior last year. And now it’s come to the “preliminary conclusion” that, yep, the tech giant has broken the rules by using independent sellers’ data for its own benefit 🙄 Put simply, Amazon can tell which third-party products are selling the best on its platform and stock the same things itself. The European Commission isn’t stopping there, either: it’s launching a new investigation into whether the company has been giving its own retail business preferential treatment over independent sellers.

Amazon's stock fell
Source: Google Finance

Why should I care?

Amazon responded with a butter-wouldn’t-melt routine, arguing that it actually represents less than 1% of the global retail market – a figure that likely leans on a catalog of “ifs”. We’ll know if that argument flies with the regulator next year, when it’s expected to make a final decision on whether the company broke competition rules 🚫 If it did, Amazon could be forced to change its business practices in the region, as well as pay a fine of 10% of its annual global revenue – a hefty $28 billion, by last year’s numbers.

Amazon has gained $616 billion in market value this year

Big Tech hasn’t been very popular with regulators for the last few years: Europe’s have fined Google more than $9 billion across three lawsuits, while the Irish government has ordered Apple to pay back more than $15 billion in taxes 💶 Chinese regulators are getting in on the action too: they published rules on Tuesday that should prevent the country’s own internet platforms – like ecommerce giant Alibaba – from abusing their market-leading positions.

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