Amazon faces investigation by UK competition watchdog

The Competition and Markets Authority (CMA) is investigating Amazon over concerns that practices affecting sellers on its UK Marketplace may be anti-competitive and could result in a worse deal for customers.

Similar concerns in the EU are being investigated by the European Commission.

The CMA investigation will consider whether the online retail giant has a dominant position in the UK and whether it is abusing that position and distorting competition by giving an unfair advantage to its own retail business or sellers that use its fulfilment services, compared to other third-party sellers on the Amazon UK Marketplace.

Amongst other things, the investigation will examine how Amazon collects and uses third-party seller data, including whether this gives the company an unfair advantage in relation to business decisions made by its retail arm.

Sarah Cardell, General Counsel at the CMA, said: “Millions of people across the UK rely on Amazon’s services for fast delivery of all types of products at the click of a button. This is an important area so it’s right that we carefully investigate whether Amazon is using third-party data to give an unfair boost to its own retail business and whether it favours sellers who use its logistics and delivery services — both of which could weaken competition.

“Thousands of UK businesses use Amazon to sell their products and it is important they are able to operate in a competitive market. Any loss of competition is a loss to consumers and could lead to them paying more for products, being offered lower quality items or having less choice.”

Separately, the CMA is also investigating both Amazon and Google over concerns that they have not been doing enough to combat fake reviews on their sites.