Backlash on entire Europe after EU antitrust investigation
When everybody was pretty focused on COVID, back in 2020, Amazon was doing, what made Amazon big: figuring out what and how others make sales, and then simply cutting them out from the market. Always bite the small retailer, as there is no legal backlash or nothing that a forever growing corporate lawyer team cannot handle.
On 10 November 2020, in Brussels, the European Commission officially raised an alarm, AGAIN, by opening a second Antitrust investigation. Details are here: Antitrust: Commission sends Statement of Objections to Amazon for the use of non-public independent seller data and opens second investigation into its e-commerce business practices. This is the second case, as it has attracted more controversy before, in July 2019: Antitrust: Commission opens investigation into possible anti-competitive conduct of Amazon.
The official response, the company said in a statement is so typical: “We disagree with the preliminary assertions of the European Commission and will continue to make every effort to ensure it has an accurate understanding of the facts,”. So, they “disagree with proof and findings of a legal investigation”; and in the same sentence, right comes a threat: “will continue to make every effort to ensure it has an accurate understanding of the facts”. Facts, that this is how they do business, now in hindsight so clear for everybody.
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The Commission objected to two specific forms of conduct Amazon allegedly engaged in:
– 1) the use of non-public data from sellers on Amazon’s platform to increase sales of in-house comparable, competing products; and
– 2) the preference towards products from Amazon and sellers using “Amazon’s logistics and delivery services” on its platform versus those from other brands.
With regard to the first objection, (reported in less than a week by US media), through several interviews with former and current Amazon employees, that rules implemented to prevent the use of private seller data were not “uniformly enforced.” Employees were able to use third-party seller data to work with manufacturers and create a similar competing product with higher margins for Amazon.
Now, in 2023, reality hits hard: Amazon Changes Sourcing Strategy in Europe. Amazon notified vendors in Europe that it was going to STOP sourcing directly from brand owners, cutting all vendors and distributors out of business, starting April, 2023. “As is common for all businesses, we regularly review our approach to product sourcing as we try to control our costs and keep prices low for customers. With this in mind, we’ve decided to focus on sourcing certain products for our European stores directly from brand owners. We will continue to source products from wholesalers and distributors if they are the brand owner or have sole distribution rights. Wholesalers and distributors are still welcome to work with Amazon and can choose to sell these products to customers directly on our store through Amazon Marketplace as a third-party seller.”
Coming up next: your European online business and European intellectual property being taken over by big cloud providers. After all, cutting out the middle-man is in their logo! The future is bright, the future is orange. :)
