This fresh inquiry comes in the wake of an existing examination by the European Commission into related issues, which excludes persistent problems impacting the UK now that it has left the EU.
Amazon’s own retail operation supplies some of the items on the Marketplace. However, a significant portion are provided by independent vendors.
These sellers can use Amazon’s services, which include those that are necessary to generate sales, such connecting them with customers.
Additionally, it provides optional services with extra costs, like Amazon’s “Fulfillment by Amazon” service.
Storage, packaging, and delivery are some parts of the sales process that are handled in this way.
The Competition and Markets Authority’s (CMA) investigation will look at whether Amazon has a dominant position in the UK, whether it is abusing that position, and whether it is distorting competition by giving its own retail business or sellers who use its services an unfair advantage over other third-party sellers on the Amazon UK Marketplace.
The three main areas under study are as follows:
How Amazon gathers and makes use of data from third-party sellers, particularly if doing so offers Amazon an unfair edge when it comes to commercial choices made by its retail division.
How Amazon decides which suppliers to place in the “Buy Box” as the preferred or top pick. The Buy Box, which is prominently featured on Amazon’s product pages, gives users the option to “Buy Now” or “Add to Basket” with just one click in relation to products from a particular seller.
How Amazon determines who is eligible to sell items under the Prime label.
Under Amazon’s Prime reward program, offers bearing the Prime label are qualified for particular advantages, such as free and quick delivery, which are only provided to Prime customers.
The CMA’s general counsel, Sarah Cardell, said:
Millions of UK residents depend on Amazon’s services for quick delivery of all kinds of goods with just the click of a mouse.
We should carefully explore if Amazon is utilizing third-party data to unfairly benefit its own retail business and whether it favours merchants who use its logistics and delivery services since both could reduce competition because this is a crucial sector.
Numerous UK companies sell their goods on Amazon, therefore it’s critical that they have the ability to compete in a crowded market.
decrease in competition is bad for consumers since it can mean higher prices, lower-quality products, or fewer options.
A full investigation will enable us to thoroughly evaluate this situation.
Whether or not there has been a violation of competition law is still an open question for the CMA.
The same issues are the subject of two prior inquiries by the European Commission. As its own inquiry in the UK moves forward, the CMA will try to communicate with the European Commission.
In addition to this issue, the CMA is currently looking into whether Amazon and Google are in compliance with consumer protection regulations after receiving complaints that they have not done enough to thwart bogus reviews on their websites. As of right now, the CMA has not made any determinations about whether or not consumer laws have been violated.