The European Union has been known for fighting for open competition in the marketplace on behalf of consumers, and various member countries have been investigating several tech companies for various antitrust allegations. Well, among that list of tech companies, one could now through e-commerce giant Amazon.com Inc. (NASDAQ:AMZN) into the mix, as German officials have been roused to scrutiny.
German regulators are being asked to investigate Amazon.com Inc. (NASDAQ:AMZN), as the company is facing allegations that it prevents third-party sellers that use the Marketplace platform to sell its goods and services from selling those same products and services on other platforms for lower prices. That could be a violation of European Union antitrust laws, which is some areas are more restrictive than those in the U.S. German authorities announced that they have begun asking more than 2,000 traders who signed up to sell to Amazon’s millions of users on the company’s highly popular Marketplace platform. Those who agree to sell on the platform had to agree to abide by Amazon policies, which included a provision that prohibits traders from selling at lower prices on soe other online platform.
The German authorities claim that may violate those traders’ rights to compete. Andreas Mundt, head of Germany’s antitrust office stated that there was a decent amount of evidence that Amazon’s policy violates “cartel rules” by suppressing competition. “Amazon’s price parity clause … takes away the traders’ freedom to offer their products at lower prices elsewhere on the Internet,” Mundt wrote in a statement.
If Amazon.com Inc. (NASDAQ:AMZN) is found in violation of antitrust rules, the company will have to drop the violating clause in its policies. There is no word whether the company would face any fines or other sanctions.
What do you think of the policy? Is Amazon.com Inc. (NASDAQ:AMZN) proper in having such an anti-compete clause in its dealings with third-party sellers? We’d like your thoughts in the comments section below.
DISCLOSURE: I own no positions in any stock mentioned.
Please see these related AMZN articles: