California sues Amazon for anticompetitive practices

According to the investigation conducted by the prosecutor, the e-commerce giant “severely penalizes” companies if their products are sold for less on other platforms.

The California attorney general on Wednesday launched a lawsuit against Amazon, which he accuses of abusing its dominant position to curb competition and drive up prices. “Amazon forces merchants to agree to deals that keep prices artificially high, knowing full well they can’t afford to say no”Rob Bonta said in a statement.

“For years, California consumers have paid more for online purchases because of Amazon’s anti-competitive practices.“, he asserts. According to the investigation conducted by the prosecutor’s office, the e-commerce giant “severely penalizes” companies if their products are sold for less on other platforms. The other market places therefore have no chance of emerging, explains the prosecution, since Amazon dominates online consumption, in particular thanks to its loyalty program, Prime.

According to research conducted by Feedvisor and cited by the release, 96% of Prime subscribers are more likely to purchase products on the platform than anywhere else, and 74% of all US consumers go directly to Amazon when they decided to buy something on the internet. Consequently, “more and more third-party merchants are adopting Amazon every day, despite the fact that their total costs to sell on this site are significantly higher than those of other online stores”assures the prosecutor’s office.

A previous complaint filed against Amazon

“We have nowhere else to go and Amazon knows that very well.said a seller quoted anonymously in the statement. Amazon did not immediately react to a request from AFP. The Seattle group insists in each publication of quarterly results and in blog posts on the positive influence it believes it has for SMEs.

Last July, “Amazon’s partners, which are mostly small and medium-sized businesses, had their best Prime Day ever.“, welcomed the company about a promotional operation. “The growth of their retail sales (on the platform) has exceeded that of Amazon products”. US states are investigating anti-competitive practices by tech giants and have launched antitrust lawsuits, including against Google and Facebook. A previous complaint against Amazon, filed by the attorney general in Washington and similar to that in California, was dismissed in March by a judge. The US Congress has been working on its side for years on bills to promote more competition on the Internet.


Leave a Comment