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Amazon has reportedly reached a settlement with the European Commission over its concerns over its use of competing sellers’ data. For example, Amazon will now give third-party products equal treatment in the “shopping box”.
According to several sources with direct knowledge of the matter, Amazon would have undertaken to increase the visibility of competing products by reserving them equal treatment in the Amazon buy box, writes the Financial Times. That framework on Amazon’s site is responsible for the lion’s share of purchases on the site. Additionally, there will be an alternative “featured offer” for customers who place little value on how quickly they receive their purchases. Sellers also have the freedom to decide which company to deliver the goods to.
This deal was to be officially announced on December 20 by the European Commission, the EU’s competition regulator. Amazon’s pledges would be market-tested, involving competitors, and EU officials would agree. Amazon’s various commitments would apply for five years. It is unknown if they will expire afterward or if other items will replace them.
This deal would reportedly end aa Commission investigation started in 2019. The question revolved around whether Amazon’s use of sensitive independent seller data on its platform gives the company a competitive advantage. If such an investigation leads to the conclusion that Amazon is breaking EU rules, it could result in a fine of up to 10% of Amazon’s global turnover. So it doesn’t seem to come to that now.
This EU study looked at two aspects. The Commission examined standard contracts concluded between Amazon and marketplace sellers, as they would allow the company to analyze and use third-party sales data. Additionally, the research focused on the role that data collected plays in selecting buy box winners. This is a field on the right side of an Amazon product page that highlights a specific seller and allows shoppers to place their product directly into the digital shopping cart. Suppliers in this box have a big advantage, because they stand out prominently and because this allows you to buy the product quickly.
Presumably the recently entered into force Digital Markets Act it also played a role in reaching the agreement between the EU and Amazon. This EU law focuses mainly on so-called gatekeepers, often large technology companies with a relatively dominant platform, which also takes into account their annual revenue and number of users. One of the practices prohibited by the DMA is to offer gatekeeper products in a more favorable way, in the sense of ranking better or higher than those of third parties who are also active on the platform with similar products.
