E.U. opens antitrust investigation into Amazon over third-party selling

The probe comes as Amazon faces growing challenges abroad. (Johannes Eisele/AFP/Getty Images)

The European Union will launch an antitrust investigation into whether Amazon is misusing its dual role as both a marketplace for independent sellers and a retailer of its own products.

In particular, the E.U. said its probe will look at the agreements between Amazon and its sellers, which allow Amazon’s retail business to analyze and use third-party seller data. The probe will also examine how Amazon uses its data to pick which sellers win the “Buy Box” — which is prominently displayed on Amazon’s site and allows customers to add items directly to their shopping carts. The “Buy Box” is often a boon for sellers, given how many orders are placed directly through it.

On Wednesday, Margrethe Vestager, the European Union’s top competition enforcer, said that as consumers are increasingly shopping online, e-commerce has boosted competition and brought more choice and better prices.

“We need to ensure that large online platforms don’t eliminate these benefits through anti-competitive behavior,” Vestager said.

In a statement, Amazon said it would cooperate fully with the E.U. “and continue working hard to support businesses of all sizes and help them grow.”

(Amazon CEO Jeff Bezos also owns The Washington Post.)

The inquiry comes as Amazon faces growing challenges abroad. Regulators across in Europe have opened multiple investigations into whether Amazon is a threat to open competition. In India, policymakers instituted a rule change that forced Amazon to scale back some of its business there. Although pushback in some of Amazon’s largest international markets is underway, the retailer’s power is only beginning to draw concerted attention in the United States.

The E.U. probe could prompt formal charges or orders for Amazon to change its business model, or it could be dropped altogether.

In September, Vestager launched a preliminary investigation into whether Amazon’s “dual role” as both retailer and marketplace gives it too much power. Vestager said her concern is that Amazon could use data from its rivals — namely merchants who sell on its platform — to edge out the competition.

“The question here is about the data,” Vestager said at the time. “If you as Amazon get the data from the smaller merchants that you host — which of course can be completely legitimate because you can improve your service to these smaller merchants — do you then also use this data to do your own calculations on what is the new big thing? What is it that people want?”

Vestager has pressed hard against Big Tech. In March, the E.U. fined Google roughly $1.7 billion for advertising practices that the bloc said violated antitrust laws. In 2018, Vestager levied a $5 billion antitrust fine against Google and required the company to changes its practices around search and Web browser functions in Android phones. That fine followed a $2.7 billion penalty on Google for how it steered users toward its comparison shopping site.