The Federal Trade Commission (FTC) and a bipartisan coalition of 17 state attorney generals sued Amazon over violations of anti-competitive behavior. The lawsuit alleges the e-commerce giant’s practices are anti-competitive in how the company serves shoppers and third-party sellers on its website.
According to the FTC announcement, the government alleges that Amazon uses anti-competitive measures that punish sellers and deter other online retailers from offering lower prices than Amazon, which keeps prices higher for consumers across the internet, even off Amazon’s platform.
In addition to its pricing policies, the FTC targets Amazon’s Prime subscription program by alleging that Amazon conditions sellers’ abilities to obtain “Prime” eligibility on sellers using Amazon’s fulfillment service. The government contends that it is more expensive for sellers on Amazon to also offer their products on other platforms, which leads to limited competition against Amazon.
“Our complaint lays out how Amazon has used a set of punitive and coercive tactics to unlawfully maintain its monopolies,” said FTC Chair Lina M. Khan. “The complaint sets forth detailed allegations noting how Amazon is now exploiting its monopoly power to enrich itself while raising prices and degrading service for the tens of millions of American families who shop on its platform and the hundreds of thousands of businesses that rely on Amazon to reach them. Today’s lawsuit seeks to hold Amazon to account for these monopolistic practices and restore the lost promise of free and fair competition.”
“We’re bringing this case because Amazon’s illegal conduct has stifled competition across a huge swath of the online economy. Amazon is a monopolist that uses its power to hike prices on American shoppers and charge sky-high fees on hundreds of thousands of online sellers,” said John Newman, deputy director of the FTC’s Bureau of Competition. “Seldom in the history of U.S. antitrust law has one case had the potential to do so much good for so many people.”
Amazon’s Senior Vice President of Global Policy and General Counsel David Zapolsky said the lawsuit is “wrong on the facts and the law, and we look forward to making that case in court.”
“The practices the FTC is challenging have helped to spur competition and innovation across the retail industry and have produced greater selection, lower prices, and faster delivery speeds for Amazon customers and greater opportunity for the many businesses that sell in Amazon’s store,” Zapolsky continued.
Photo courtesy Amazon
