Second fine against Amazon in Italy in less than two weeks. The Italian Competition and Market Authority (AGCM) has fined the US tech giant 1,130 million euros for abusing its “absolutely dominant position in the Italian market” with a “particularly serious” strategy to harm to competitors in the e-commerce logistics service, as reported today in a statement.
The regulator argues that Amazon has an “absolute dominant position” in the Italian market for market intermediation services”, which has allowed it to favor its logistics service, called FBA, among sellers active on the Amazon platform. it in the to the detriment of competing operators on this market and strengthen its dominant position”.
The AGCM explains in its note that “companies have linked to the use of Amazon’s logistics service access to a set of essential advantages to obtain visibility and better sales prospects on Amazon.it”. Among these exclusive advantages, the “Prime label” stands out, which facilitates the sale to the most loyal and dependent consumers.
This label also “allows participation in Amazon events, such as Black Friday and Cyber Monday or Prime Day, exclusive to the company, and increases the likelihood that the seller’s offer will be selected as a Storefront offer and displayed in the BuyBox, according to the agency, which also points out that, in this way, the company prevented third-party sellers from associating the Prime label with offers that did not work with its FBA logistics service.
The company, which violated Article 102 of the Treaty on the Functioning of the European Union, also “prevented third-party sellers from associating the Prime label with offers not managed” by FBA.
The regulator argues that this feature of Amazon.it “is crucial for the success of sellers and for increasing their sales”, noting that “third-party sellers who use FBA do not apply the strict performance measurement system to which Amazon subjects non-FBA sellers and failure to comply with which may also result in the suspension of the seller’s account.”
Based on this argument, the Italian authority concludes that Amazon harmed competing e-commerce logistics operators, “by preventing them from offering themselves to online sellers as providers of quality services comparable to the logistics of Amazon”. And he points out that the company has widened the gap between the power available to the American giant and that of the competition, “even in the delivery of e-commerce orders”.
According to AGCM“the competing mercados se han visto perjudicados por el abuso: debido al coste de la duplicación de almacenes, los vendedores que adoptan la logística de Amazon se ven disuadidos de offer sus products en otras plataformas en línea, al menos con la misma range de produits “.
The regulator, who describes Amazon’s “abusive” strategy as “particularly serious”, requires the multinational to change its practice “in order to immediately restore competitive conditions in the markets concerned”, and specifies that its behavior will be examined by a fiduciary supervisor.
“Amazon must grant full selling privileges and visibility on its platform to all third-party sellers who know how to follow fair and non-discriminatory rules in the processing of their orders, in accordance with the level of service that Amazon intends to offer to consumers. Prime,” he said. the organism.
The company must define and publish these rules and, from one year after the decision, “it must refrain from negotiating with competing carriers and/or logistics operators the rates and other contractual conditions applied to the logistics of your orders on Amazon.it”, excluding FBA”.
An Amazon spokesperson said Thursday they “strongly disagree with the decision” and will appeal the ruling. “The fine and the proposed measures are unjustified and disproportionate. More than half of all Amazon’s annual sales in Italy come from small and medium-sized enterprises, and their success is an essential part of our business model”, specifies the same source.
From the company, they insist that SMEs have several channels to sell their products at once in line What offline, and Amazon is just one of those options. We are constantly investing to support the growth of the 18,000 Italian SMEs that sell on Amazon, and we provide multiple tools to sellers, including those who manage their own shipments.
Amazon was previously fined 68.7 million euros by the AGCM on November 23 for establishing a “restrictive agreement” with Apple on the sale of products on October 31, 2018 which prevented all legitimate distributors from operate. According to the institution, under the said agreement, Amazon agreed to the iPhone maker’s terms to prohibit third-party companies from selling the apple company’s products and those of the Beats brand, also owned by Apple, on its website.
The agency, which also fined Apple for the same reason, fining 134.5 million, indicated that the agreement sealed between the two technology giants “did not allow all legitimate distributors of ‘genuine’ Apple and Beats products to operate on the amazon.it market”, in which they could only sell ” Amazon and certain individually and jointly selected entities.” discriminatory manner”. The impact of the agreement has been significant, they explained, since 70% of electronics purchases in Italy are made on Amazon.
In Spain, Amazon and Apple have opened a disciplinary case with Spain’s National Markets and Competition Commission (CNMC) for reaching a similar deal on Amazon’s Spanish site. The Spanish regulator is also seeing signs of an agreement between the two companies to prevent third parties from selling Apple products through Amazon’s website, among other illegal practices.