Italy fines Amazon €1.13B for abusing market dominance

Italy’s competition authority slapped a €1.13 billion fine on Amazon for abusing its dominant position in the market and harming competitors in the e-commerce logistics service.

The Autorità Garante della Concorrenza e del Mercato (AGCM) said on Thursday that Amazon was giving sellers using its logistics service, called “Fulfillment by Amazon,” advantages in terms of visibility and sales, including access to its “Prime” label. Amazon said it “strongly” disagrees with the AGCM’s decision and will appeal.

The large fine comes amid increased antitrust scrutiny of Big Tech worldwide. The European Commission has opened an investigation similar to the Italian one that focuses on the rest of the EU.

“Amazon holds a position of absolute dominance in the Italian market for intermediation services on marketplaces, which has allowed it to favor its own logistics service,” the Italian regulator said in a statement, adding that Amazon’s conduct was “particularly serious.”

The AGCM also imposed behavioral measures, including ordering Amazon to set “fair and non-discriminatory standards” for third-party sellers to get advantages in terms of sales and visibility. A monitoring trustee will review these measures.

The watchdog launched its probe in 2019 over concerns that Amazon was giving sellers using its logistics service a better chance to appear as Amazon’s pick for users searching a product featured in a separate section of its website, the “buy box.” This is a pop-up window that shows customers additional products when they proceed with a purchase.

In saying the company plans to appeal the regulator’s decision, an Amazon spokesperson said: “The proposed fine and remedies are unjustified and disproportionate.”

Last year, the European Commission also opened a probe into the same practices but carved Italy out of its scope of investigation, to allow the country’s antitrust watchdog to proceed. In January this year, Amazon challenged that carve-out.

Like the Italia authority, Brussels is investigating potential anticompetitive practices related to Amazon allegedly pushing sellers to use the company’s logistics and delivery operations, including its Prime service. The investigation focuses on how third-party sellers are chosen to be included in the “buy box,” including an in-depth look at the criteria Amazon uses in the selection.

The EU also has another probe focusing on the e-commerce giant. The Commission has charged the company with misusing data of independent merchants who sell on Amazon’s marketplace to favor Amazon’s own products.

At the end of November, the Italian authority fined Amazon and Apple in a separate case for colluding over the sale of Apple products.