Italy fines Amazon record $1.3 bln for abuse of market dominance
Italy's antitrust watchdog said on
Thursday it had fined Amazon 1.13 billion euros ($1.28 billion) for alleged
abuse of market dominance, in one of the biggest penalties imposed on a U.S.
tech giant in Europe.
Amazon said it "strongly disagreed"
with the Italian regulator's decision and would appeal.
Global regulatory scrutiny of tech
giants has been increasing after a string of scandals over privacy and
misinformation, as well as complaints from some businesses that they abuse
their market power.
As well as Amazon, Alphabet's Google
(GOOGL.O), Facebook Inc (FB.O), Apple Inc (AAPL.O) and Microsoft Corp (MSFT.O)
have drawn heightened scrutiny in Europe.
Italy's watchdog said in a statement
that Amazon had leveraged its dominant position in the Italian market for
intermediation services on marketplaces to favour the adoption of its own
logistics service - Fulfilment by Amazon (FBA) - by sellers active on Amazon.it.
The authority said Amazon tied to
the use of 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," it said.
The Prime label makes it easier to
sell to the more than 7 million most loyal and high-spending consumers members
of Amazon’s loyalty program.
The antitrust authority also said it
would impose corrective steps that will be subject to review by a monitoring
trustee.
Amazon said FBA "is a
completely optional service" and that 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", the U.S. group said in a statement.
"The proposed fine and remedies
are unjustified and disproportionate", it added.
The EU Commission said it had
cooperated closely with the Italian competition authority on the case, within
the framework of the European Competition Network, to ensure consistency with
its two own ongoing investigations into Amazon's business practices.
The first was opened in July 2019 to
assess whether Amazon's use of sensitive data from independent retailers who
sell on its marketplace was in breach of EU competition rules.
The second, in late 2020, focussed
on the possible preferential treatment of Amazon's own retail offers and those
of marketplace sellers that use Amazon's logistics and delivery services.
"This investigation complements
today’s decision
of the Italian competition authority which addresses Amazon’s conduct in
the Italian logistics markets," the Commission said on Thursday.
($1 = 0.8832 euros)