UK Antitrust Watchdog Looking Into Amazon’s Business Practices

The U.K.’s antitrust regulator announced on Wednesday that it is looking into whether the American e-commerce Amazon is damaging competition by giving its own retail business and sellers who use its services an unfair advantage over independent retailers on its marketplace.

The Competition and Markets Authority of Britain announced that it was looking into Amazon’s actions regarding merchants in its U.K. marketplace. a market that may be anti-competitive and could give clients a worse value.

Amazon operates a retail store and sells goods through the marketplace. 

However, Amazon also enables the sale of goods by independent retailers, who can use services from Amazon-like logistics support or customer matching.

There will be three primary areas that would be focused on for CMA’s examination. 

CMA will determine how and to what extent Amazon gathers and makes use of data from third-party sellers, and whether this offers Amazon an unfair advantage in the choices it makes about its retail operations.

The CMA will be looking at how Amazon sets the criteria for suppliers to be the preferred or first choice in the “Buy Box,” an area on Amazon’s product pages that allows shoppers a one-click option to “Buy Now” or “Add to Basket.”

CMA will also examine how Amazon determines which products qualify for the Prime badge. 

Amazon’s paid subscription service Prime offers clients quick shipping and access to additional merchandise.

“Millions of people across the UK rely on Amazon’s services for the fast delivery of all types of products at the click of a button. This is an important area so it’s right that we carefully investigate whether Amazon is using third-party data to give an unfair boost to its own retail business and whether it favors sellers who use its logistics and delivery services – both of which could weaken competition,” Sarah Cardell, General Counsel at the CMA, said in a statement

Cardell added numerous UK companies sell their goods on Amazon, therefore it’s critical that they have the ability to compete in a crowded market. 

The CMA’s general counsel added that any decrease in competition is bad for consumers since it can mean higher prices, lower-quality products, or fewer options.

A spokesperson from Amazon said in a statement published on CNBC they will work closely with CMA during their investigation. 

However, Amazon believed they’ve always “worked hard to help small businesses” selling on their platform to succeed in both their and the company’s best interest. 

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