Italy fines Amazon a record $1.3 billion for abuse of dominant market position

  • Amazon abused dominance of intermediation services – watchdog
  • Amazon disagrees with regulator’s decision to appeal
  • Amazon considers a fine “unjustified and disproportionate”

MILAN, Dec 9 (Reuters) – Italy’s antitrust authority said on Thursday it had fined Amazon 1.13 billion euros ($1.28 billion) for allegedly abusing its dominant market position. one of the heaviest sanctions imposed on an American technology giant in Europe.

Amazon said it “strongly disagrees” with the Italian regulator’s decision and will appeal.

Global regulatory scrutiny of tech giants has intensified after a series of scandals over privacy and misinformation, as well as complaints from some companies that they are abusing their market power.

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Besides Amazon, Alphabet’s Google (GOOGL.O), Facebook Inc (FB.O), Apple Inc (AAPL.O) and Microsoft Corp (MSFT.O) have come under increased scrutiny in Europe.

The Italian watchdog said in a statement that Amazon had leveraged its dominant position in Italy’s market for marketplace intermediation services to drive adoption of its own logistics service – Fulfillment by Amazon ( FBA) – by active sellers on Amazon.it.

The authority said Amazon is tied to using FBA access to a set of exclusive benefits, including the Prime label, that help increase visibility and boost sales on Amazon.it.

“Amazon prevents third-party sellers from associating the Prime label with offers not managed with FBA,” he said.

The Prime label makes it easier to sell to the more than 7 million most loyal and highest spending consumers who are members of Amazon’s Loyalty Program.

Amazon’s logo is seen at the company’s logistics center in Boves, France, October 6, 2021 REUTERS/Pascal Rossignol/File Photo

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The antitrust authority also said it will impose remedies that will be subject to review by a monitoring trustee.

Amazon said FBA “is a completely optional service” and the majority of third-party sellers on Amazon do not use it.

“When sellers choose FBA, they do so because it is efficient, convenient and competitive in terms of price”, specifies the American group in a press release.

“The fine and the proposed reparations are unjustified and disproportionate,” he added.

The European Commission said it had cooperated closely with the Italian competition authority on this case, as part of the European Competition Network, to ensure consistency with its own two ongoing investigations into commercial practices. from Amazon.

The first was opened in July 2019 to assess whether Amazon’s use of sensitive data from independent retailers who sell on its marketplace breached EU competition rules.

The second, in late 2020, focused on the possible preferential treatment of Amazon’s own retail offerings and those of marketplace sellers who use Amazon’s logistics and delivery services.

“This investigation complements the decision issued today by the Italian competition authority which addresses Amazon’s behavior in Italian logistics markets,” the Commission said on Thursday.

($1 = 0.8832 euros)

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Reporting by Elvira Pollina and Maria Pia Quaglia; edited by Alexander Smith and Jason Neely

Our standards: The Thomson Reuters Trust Principles.

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