Germany’s competition regulator to investigate Amazon’s marketplace

Germany’s competition regulator (Bundeskartellamt) is opening an investigation against Amazon. In particular, the regulator is going to look at the relationship between Amazon and third-party sellers on the platform.

“Its double role as the largest retailer and largest marketplace has the potential to hinder other sellers on its platform,” Bundeskartellamt president Andreas Mundt wrote in the announcement. “Because of the many complaints we have received we will examine whether Amazon is abusing its market position to the detriment of sellers active on its marketplace.”

And it’s true that Amazon is in a difficult position when it comes to anti-trust investigations. The company sells products directly to consumers — you can even buy Amazon-branded items. But many sellers list items on the platform directly and send them directly to customers.

Some of them choose to ship items from their own warehouses, while others participate in the “Fulfillment by Amazon” program. This program has become increasingly important to the company’s bottom line.

German regulators want to look at “product reviews, the non-transparent termination and blocking of sellers’ accounts, withholding or delaying payment, clauses assigning rights to use the information material which a seller has to provide with regard to the products offered and terms of business on pan-European despatch.”

French regulators also fined Amazon back in December 2017, according to Le Parisien — an $11.4 million fine (€10 million). Once again, regulators didn’t like the terms between Amazon and third-party companies. Sellers have to comply to unfair rules and Amazon can terminate relationships whenever they want.

Amazon has to tread carefully as it acts as a gateway between customers and sellers. Let’s see if those investigations in France and Germany could lead to tougher rules at the European level.

In addition, two months ago, the European Commission revealed it’s looking into competition concerns related to Amazon using data from retailers selling via its e-commerce marketplace.

Although antitrust chief Margrethe Vestager said it was not a formal probe at that stage, but rather an information-gathering exercise — in order to “get the full picture.”