CMA to consult on changes offered by Amazon Marketplace

by | Jul 26, 2023

(Sharecast News) – In response to concerns raised by the Competition and Markets Authority (CMA) over potential anti-competitive practices, Amazon has offered to implement changes to the way it treats third-party sellers using its Marketplace platform in the UK, it emerged on Wednesday.
The CMA launched an investigation in July last year after receiving complaints that Amazon was allegedly abusing its dominant position in the UK’s online retail market.

It said the allegations suggested Amazon was favouring its own retail business over competing sellers also using Amazon’s Marketplace, or those using Amazon’s warehousing and delivery services.

One of the key concerns raised was that Amazon might have been leveraging data obtained from third-party sellers to gain an unfair advantage over other sellers on the platform.

The data in question was believed to be commercially sensitive, and was allegedly used by Amazon’s retail business to influence product selection, manage stock levels, set prices, and make other strategic decisions.

According to the CMA, the proposed commitments by Amazon were aimed to ensure the company would not use data from rival sellers to gain a competitive edge.

Another aspect of the proposed commitments pertained to the ‘buy box’ feature on product pages.

The CMA described the ‘buy box’ as a coveted section where customers could directly add an item to their shopping carts.

It said it observed that third-party sellers often faced difficulty in having their product offers featured in the ‘buy box’, when compared to Amazon’s own retail business or third-party sellers using Amazon’s delivery services.

The proposed changes would apparently seek to guarantee that all product offers were treated equally when Amazon decides which ones would be featured in the ‘buy box.’

Additionally, Amazon’s proposed commitments also included allowing third-party businesses to negotiate their own delivery rates directly with independent providers of Prime delivery services.

That move was aimed at providing customers with more competitive delivery costs, as third-party sellers would be able to seek better rates through negotiations.

To ensure the implementation and adherence to these commitments, Amazon had reportedly agreed to appoint an independent trustee to monitor it compliance.

The CMA said it would have a direct say in this appointment to ensure the trustee possessed the necessary skills and expertise for the job.

“Amazon’s commitments to the CMA will help ensure that third-party sellers on Amazon Marketplace can compete on a level-playing field against Amazon’s own retail business and, ultimately, mean that customers in the UK get a better deal,” said the CMA’s senior director for enforcement, Ann Pope.

“The CMA took this action after it heard concerns that Amazon was using its strength in the market to gain an advantage over thousands of businesses which use Amazon Marketplace to reach customers.

“We are now consulting on these commitments which we believe, at this stage, will address our concerns.”

Reporting by Josh White for

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