The California attorney general filed lawsuits against Amazon on Wednesday, which he accuses of abusing its dominant position to stifle competition and drive up prices, a complaint that adds to the already numerous attempts by regulators to stop the expansion of the giant.
“For years, California consumers have paid more for online purchases due to anti-competitive practices by Amazon,” he said.
According to the investigation carried out by the prosecution, the e-commerce giant “severely penalizes” companies if their products are sold for less on other platforms.
Therefore, the other markets have no chance to emerge, explains the indictment, since Amazon dominates online consumption, in particular thanks to its loyalty program, Prime.
According to a study conducted by Feedvisor and cited by the press release, 96% of Prime subscribers are more likely to purchase products on the platform than anywhere else, and 74% of all US consumers go directly to Amazon. when they decide to buy something. In Internet.
As a result, “every day more third-party merchants are adopting Amazon, despite the fact that their total costs to sell on this site are significantly higher than those of other online stores,” says the prosecution.
“We have nowhere to go and Amazon knows that very well,” said an anonymous seller quoted in the statement.
“Amazon is proud”
Many US states are investigating the tech giants’ anti-competitive practices and have launched lawsuits, including against Google and Meta (Facebook), for violating competition law.
An earlier complaint against Amazon, filed by the Washington city attorney general and similar to the one in California, was dismissed in March by a judge.
“We hope that the Californian justice reaches the same conclusion as that of Washington and quickly dismiss these demands,” reacted the Seattle group, contacted by AFP.
“Sellers set their own prices for the products they offer in our store,” the spokesperson said. “Amazon prides itself on offering low prices on a very wide selection. And like any store, we reserve the right not to present offers that are not competitively priced.”
He claims that if Rob Bonta were to win his lawsuit, the platform would be “forced to display higher prices for customers, which curiously would go against essential principles of competition law.”
Amazon insists in each publication of quarterly results and in press releases on the positive influence that it considers to have for SMEs.
Last July, “Amazon partners, which are mostly small and medium-sized businesses, had their best Prime Day yet,” the company said in a promotional campaign. “Their retail sales growth (on the platform) has outpaced that of Amazon products.”
California “hypocrite”
It will be “extremely difficult to prove that Amazon is raising prices,” said Neil Saunders, director of GlobalData.
According to the analyst, the contracts criticized by the prosecutor are not unusual and do not prevent merchants from lowering their prices, as long as they do so elsewhere, which guarantees the best prices for the site’s clients.
“It’s also a bit hypocritical of California to feign concern for consumers when the state has policies that keep many prices and taxes, like gasoline, very high,” he added.
The United States Congress has been working on your side for years to reform competition law.
A series of bills directly targeting Google, Apple and Amazon passed a parliamentary committee in June 2021 and then the Senate Judiciary Committee last January.
The texts seek to limit the control that these companies exercise over their sales platforms (Google and Apple application stores), where they are both judges and parties.
This means, for example, preventing them from favoring their own products, interfering with the prices established by merchants or even using non-public data generated by the sales of other sellers to their advantage.
But the final vote has been postponed several times.
Source: BFM TV
