Competition: five questions on Brussels' accusations against Amazon

DECRYPTION

Amazon in the sights of Brussels: the European Commission accuses the juggernaut of online sales of having violated European competition rules, further increasing international pressure against platforms suspected of abusing their omnipotence.

What can be the outcome of such a conflict?

Here are five questions to try to understand a case that could have repercussions on the consumer.

What does the EU hold against Amazon?

The European Union believes that the American group benefits from data from independent retailers using its website.

She opened an in-depth investigation into this matter in July 2019 and has now communicated her grievances.

"According to preliminary findings, Amazon has abused its dominant position as a marketplace in France and Germany", its two biggest markets in Europe, Competition Commissioner Margrethe Vestager said at a press conference .

The American company has a dual function.

It sells products directly on its website, but it also provides independent sellers, with whom it competes, a market place on which they can sell to consumers.

However, it appears that "considerable volumes of non-public data from sellers are available to employees of Amazon's retail activity," said Margrethe Vestager, adding that this data fed into the company's algorithms. and allowed him to better calibrate his offers.

This allows Amazon, for example, to focus its offers on the products that sell best in the different categories or to adjust its prices.

What does the second survey consist of?

Brussels also announced Tuesday the opening of a second "in-depth investigation" targeting the platform, suspecting preferential treatment of offers from Amazon or sellers of its marketplace using the delivery services of the American giant.

These suspicions relate in particular to the Prime loyalty system, whose users, often large buyers, would not be equally accessible to all sellers of the platform.

What does Amazon say?

Amazon immediately disputed these findings.

"We disagree with the preliminary assertions of the European Commission and we will continue to make every effort to ensure that it has an accurate understanding of the facts," the company said in a statement.

The distributor says it represents less than 1% of the global retail market and that there are "stronger competitors in all countries" where it operates. 

"No company is more attentive to small businesses or has done more than Amazon to support them for 20 years", he added, estimating at 150,000 the number of companies which sell on his platform for "hundreds of thousands of jobs created ".

What consequences for the platform?

Brussels does not prejudge the outcome of these two investigations, the American online sales giant still having the opportunity to present its arguments.

But the penalties imposed by the Commission in similar cases can reach up to 10% of turnover.

The announcements from Brussels come as Amazon is increasingly criticized for taking advantage of the health crisis that is forcing many businesses to close while online sales are breaking records.

Amazon announced a tripling of its net profit to $ 6.3 billion in the third quarter, a surge in revenue from its items sold online by 38%, while sales of third-party companies using its platform increased by 55%. %.

How does the EU want to take control?

The European Commission is also due to announce new legislation in December to better regulate and make major internet platforms more transparent, in particular by updating its 20-year-old e-commerce directive, when new digital players were no longer available. not yet born or were taking their first steps.

The young shoots of the time are now worth trillions of dollars and have accumulated such power that they are today in the sights of European authorities, but also American.

At the end of October, lawsuits were initiated in the United States against Google for abuse of a dominant position, foreshadowing possible similar actions in this country against Apple, Facebook and Amazon.