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Amazon fined $ 1.3 billion in Italian antitrust case


MILAN: Italian competition regulator fines Amazon.com Inc.

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$ 1.3 billion, saying it hurt competitors by favoring third-party vendors who use the company’s logistics services, a move that reflects increased scrutiny of tech giants by antitrust regulators around the world.

The regulator said Thursday that Amazon favors sellers in Italy who pay it to use its warehouse and delivery services, including making them more likely to appear as the default option, or “Buy Box,” when consumers click to buy a product.

The € 1.13 billion fine is part of a wave of antitrust enforcement in Europe and elsewhere against Amazon and other big tech companies for allegedly abusing their dominance to crush smaller competitors .

Companies including Apple Inc., Alphabet Inc.

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Over the past two years, Meta Platforms Inc.’s Google and Facebook have been the subject of formal investigations, charges or fines in various cases filed by the European Union and countries like the United States, the United Kingdom, France and Germany. The companies have denied the wrongdoing.

In addition to the fine, the Italian regulator ordered Amazon to offer “fair and non-discriminatory standards” for ads from third-party sellers, which it would monitor through a designated agent.

In Italy, the antitrust regulator can fine a company up to 10% of its annual turnover, although the final figure depends on where the abuses occurred and how long. A spokeswoman said the fine could be the largest ever imposed by the regulator.

Amazon called the fine and the remedies described by Italian authorities “unwarranted and disproportionate” and said it would appeal. In the Italian legal system, if the first court confirms the fine and appeals, the company can again appeal to a higher court. The court can also decide to reduce the fine or adjust the changes that Amazon is required to make.

The antitrust regulator’s two-year investigation found that in 2019, Amazon’s market share in online marketplaces was up to five times that of its closest competitor and the gap grew. has widened considerably over the past four years. In 2019, more than 70% of the total value of sales of products from third-party sellers in online marketplaces in Italy took place on amazon.it, according to the regulator.

Amazon has used this dominance to drive adoption of its logistics services, which appear to consumers as an “achievement by Amazon” when choosing which product to buy.

Amazon’s treatment of third-party sellers on its platforms has become a hot topic of debate. A Wall Street Journal survey last year found that Amazon employees were using data from other sellers to develop competing products. Amazon has launched an internal investigation and said employees who do so will violate its policies.

CEOs of Amazon, Apple, Facebook and Google faced tough questions and, at times, hostile criticism of their business practices during a House antitrust hearing. The session highlighted how four of the five most valued U.S. companies are scrutinized from both sides of the aisle. Photo: US House Judiciary Committee / Reuters

Amazon says it relies heavily on third-party sellers for its revenue and therefore is invested in their success. He claims the majority of his salespeople don’t use his logistics department, and those who do because it is efficient and profitable.

Regulators allege that in practice it may be difficult for outside companies to meet Amazon’s criteria to qualify for a better placement on its site, saying this effectively forces some sellers to use the company’s logistics services. .

The EU’s main competition enforcement official is carrying out an investigation similar to that of the Italian investigation. Last year, the bloc separately filed antitrust charges against Amazon for allegedly using non-public data from third-party sellers to compete with them. The company denied any wrongdoing.

The EU competition authority has cooperated closely with the Italian competition authority on the case to “ensure consistency with its own investigations”, according to an EU spokesperson. Both investigations are ongoing.

Write to Eric Sylvers at eric.sylvers@wsj.com and Sam Schechner at sam.schechner@wsj.com

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