The AGCM, the Italian Competition Authority, has just imposed a fine of 1, 000 billion euros to Amazon. The company of Jeff Bezos would have been guilty of abuse of a dominant position. It is one of the largest sanctions ever imposed in Europe on an American technology giant.
Differences in treatment
According to the authority, companies must use Amazon’s delivery service (FBA) if they wish to access important advantages such as the Prime label, which allows them in particular to participate in Black Friday sales and to increase their visibility and sales. The AGCM found that Amazon tied the designation “Fulfilled by Amazon” to a series of exclusive benefits for adhering sellers. “Amazon has thus prevented third-party sellers from associating the Prime label with offers not managed with Fulfilled by Amazon”, indicates the AGCM.
The authority also noted that the sellers third parties using “Fulfillment by Amazon” are not subject to the same performance requirements as other sellers. The former would indeed be less likely to be suspended from the platform if they do not achieve certain objectives. Finally, sellers are discouraged from offering their products on platforms other than Amazon’s.
The AGCM said it had imposed a significant fine because it considered the actions of Amazon as “particularly serious” given their duration and the effects they have caused.
Amazon refutes the accusations
In addition to this fine, the authority also demanded that Amazon grant the same privileges to all sellers, even if they do not use “Fulfillment by Amazon”. A period of one year is given for the application of these measures. Amazon has obviously already appealed against the decision.
“We strongly disagree with the decision of the Italian Competition Authority and we will appeal,” said a spokesperson from Amazon at Engagdet . “The fine and the remedies proposed are unjustified and disproportionate. Over half of all annual Amazon sales in Italy come from SMEs, and their success is at the heart of our business model. Small and medium-sized businesses have several channels to sell their products online and offline: Amazon is just one of them. We are constantly investing to support the growth of 13. 000 Italian SMEs that sell on Amazon , and we provide multiple tools for our sellers, including those who handle shipments themselves. ”
Beyond the immediate effects for Amazon, whose shares have lost about one percent of their value in recent years 24 hours, the impact of this fine and its consequences on prices remains to be determined.