Amazon targeted by 900 million pound lawsuit in the UK

Posted Oct 20, 2022 2:17 PMUpdated Oct 20, 2022, 5:33 PM

Gray times for the American e-commerce giant Amazon. A complaint on behalf of millions of British users of its platform will be filed on October 31 at the London Court of Appeal for Competition. The reason: an abuse of a dominant position that would harm consumers. According to economists’ estimates, based on the amount of potential losses, the damages claimed could reach 900 million pounds sterling (1.02 billion euros).

At the origin of the case, the law firm Hausfeld and Julie Hunter, a British activist for consumer rights, appointed to conduct this procedure “in class action”, on behalf of the complainants.

Amazon’s “Buy Box” in question

According to the press release which explains the reasons, Amazon would encourage, thanks to “a secret algorithm which favors it”, users to click on its “Buy Box” section (shopping box). There would be products sold directly by the platform or by third-party sellers “who pay huge storage and delivery costs” to find themselves put forward.

“More than 80% of purchases on Amazon are made via the offers contained in the ‘Buy Box'”, but “many independent sellers are excluded even when they offer the same product for less”, is it lamented in the communicated.

“Amazon is taking advantage of the well-known consumer trend to focus on prominent and eye-catching displays, such as the ‘Buy Box’,” said Hausfeld attorney Lesley Hannah. “Amazon should not be allowed to take advantage of its customers in this anti-competitive way,” she said.

In a statement received by AFP on Thursday, Amazon replies that the complaint is “unfounded” and that the e-commerce giant “is still striving to support the 85,000 companies that sell their products on its online store. United Kingdom “. “More than half of our sales of physical products on our UK site come from independent seller partners,” defends the firm.

Other procedures on the back

In July, Amazon had proposed an agreement to close two investigations by the European Commission, which suspects it of violating competition rules, in particular in the preferential treatment of sellers using its delivery services.

The platform has pledged to provide “equal treatment to all sellers” for the “Buy Box” and “to display a second competing offer”. In particular, it promised, as part of its Prime program, to allow sellers “free choice of any carrier”.

The European Commission, which opened an investigation in July 2019, also criticizes Amazon for relying on commercial data from independent retailers to calibrate its own offer. However, an agreement has not yet been reached and discussions are continuing.

Another dispute to mention: in Italy, the competition policeman imposed a fine of 1.128 billion euros on Amazon in December 2021 for having discriminated against sellers who had not used its logistics service. The e-commerce group appealed.

Gafa in the sights of regulators

US tech giants are frequently accused of breaking competition rules. Google was heavily sanctioned by the EU, for a cumulative total of 8 billion euros.

Microsoft has also received several European sanctions for having imposed its Internet Explorer browser. Apple has been accused since May 2022 of abuse of a dominant position in contactless payments.

With Agencies

Leave a Comment