Amazon fined $ 1.3 by regulators in Italy

Amazon was fined nearly $ 1.3 billion on Thursday by Italian regulators who accused the company of violating antitrust laws by granting special benefits to third-party merchants who use the warehouse system and delivery from Amazon.

The Italian Competition Authority’s decision is one of the first instances of a regulator investigating how Amazon is using the combination of its extensive logistics network and online marketplace to gain an advantage over its competitors.

The regulator said Amazon offers merchants who pay to use the system, called Fulfillment by Amazon, incentives such as access to Amazon Prime customers, meaning their products can often be shipped within 24 hours at no cost. Delivery. Suppliers can also participate in promotions such as Black Friday, Cyber ​​Monday, and Prime Day which are not available to those who do not use Amazon’s distribution system.

“The investigation revealed that these are functions of the platform that are crucial for the success of sellers and for increasing their sales,” the competition authority said in a statement.

Most of the products available on Amazon are offered by external vendors who use the Amazon site as a marketplace to reach customers. Amazon takes a percentage of each sale. For an additional cost, the company offers Fulfillment by Amazon, which allows suppliers to store their products in Amazon’s warehouses and delivery system, as well as inventory management, returns, and customer service programs.

Amazon said it would appeal the decision. Fulfillment by Amazon is an optional offering, the company said, and the majority of third-party merchants selling products on Amazon do not use the company’s logistics system. The company said there are other methods for external vendors to reach Prime customers other than Fulfillment by Amazon.

“We strongly disagree with the decision of the Italian Competition Authority,” the company said. “The fine and the proposed remedies are unjustified and disproportionate.”

Amazon has invested heavily in Italy, where online shopping increased during the pandemic after being less common than other markets like the United States, Britain or Germany. In Italy, Amazon has built fulfillment warehouses and other parts of its logistics system to help attract customers with fast delivery.

In addition to the fine, Italian regulators have said Amazon must give external vendors who do not use Fulfillment by Amazon access to the same sales and visibility opportunities, if they use a logistics operator meeting certain requirements. standards. Amazon has one year to come up with standards that external logistics companies must meet to qualify.

Amazon has become a frequent target of antitrust authorities. The European Commission, the executive body of the European Union, is investigating Amazon for unfairly using data collected from third-party merchants to bolster its own product offerings.

Italian regulators last month fined Amazon and Apple more than $ 225 million in total for anti-competitive cooperation related to the sale of Apple and Beats products on Amazon. The companies have said they will appeal.

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