European Commission Investigates How Amazon Uses Data

The European Commission is launching an antitrust investigation into Amazon, and its potential misuse of merchant data.

Specifically, the EC wants to know more about Amazon’s continuous collection of consumer activity data while providing a marketplace for independent sellers.

“I have … decided to take a very close look at Amazon’s business practices and its dual role as marketplace and retailer,” Commissioner Margrethe Vestager stated.

Based on preliminary findings, the EC already suspects Amazon is using “competitively sensitive” information about marketplace sellers, their products and transactions on the marketplace.

As part of its in-depth investigation, it plans to delve into the standard agreements between Amazon and marketplace sellers, which allow its retail business to analyze and use third-party seller data.

In particular, the EC plans to focus on whether and how Amazon's use of accumulated marketplace seller data impacts competition.

The EC also wants to know more about the role of data in the selection of the winners of Amazon’s “Buy Box,” as well as the impact of Amazon's potential use of competitively sensitive marketplace seller information on that selection.

The “Buy Box” is displayed prominently on Amazon and allows customers to add items from a specific retailer directly into their shopping carts.

Winning the “Buy Box” appears to be key for merchants, as it is involved in the vast majority of transactions.

If proven, the EC is warning that practices under investigation might breach EU competition rules on anti-competitive agreements between companies.

Reuters reported on Wednesday that Amazon has already agreed to cooperate fully with the investigation.

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