Amazon fined $1.3 bn in Italy for misusing dominant market position

Rome, Dec 9: The Italian Competition Authority, a quasi-autonomous non-governmental organization, fined the online retailer Amazon 1.1 billion euros ($1.3 billion) for abusing its dominant market position, the authority said on Thursday.
“The Authority imposed behavioral measures on Amazon that will be subject to review by a monitoring trustee. The Authority fined Amazon Europe Core S.à r.l., Amazon Services Europe S.à r.l., Amazon EU S.à r.l., Amazon Italia Services S.r.l. e Amazon Italia Logistica S.r.l. € 1,128 billion for a breach of Art. 102 of the Treaty on the Functioning of the European Union,” the organization said in a statement.
According to the regulator, Amazon took advantage of its dominant position in the Italian market, which allowed it to develop and promote its own logistics services. This allegedly damaged competitors in the market for e-commerce logistics services.
Italy’s antitrust body believes that Amazon’s subsidiaries linked its own logistics services to the access to special benefits essential for gaining visibility. Such benefits include the Prime loyalty program, which makes it easier to sell to regular consumers who buy goods by subscription, the authority said. The Prime program also allows sellers to participate in Amazon’s sales and increases the likelihood that their specific offers will be selected as featured.
That way, Amazon allegedly prevented third-party sellers from associating the Prime label with offerings not covered by its own logistics service.
In addition, sellers using Amazon’s logistics services are not subject to its rating system, a violation of which can lead to a freeze of non-compliant sellers’ profile, the regulator added.
“In so doing, Amazon harmed competing e-commerce logistics operators, preventing them from presenting themselves to online sellers as providers of services of comparable quality to Amazon’s FBA and thus capable of ensuring high visibility on Amazon.it. Such a conduct widened the gap between Amazon’s market power and its competitors’ also in the delivery of e-commerce parcels,” the statement said.
According to the authority, the large amount of the fine was chosen due to the duration of the abusive practices and the size of the Amazon group itself. Remedying of violations will take place under special supervision of the antitrust service.