The consumer watchdog in Germany has announced it will be investigating Amazon for abusing its dominance in the market, and using anti-competitive practices that are in violation of Germany’s laws.
The Germany antitrust department has said it is investigating the relationship that Amazon has with its third-party sellers, with the President of the Federal Cartel Office, Andreas Mundt stating that “Amazon must not be a price controller… we are currently investigating whether and how Amazon influences how trades set prices on the marketplace.”
“Price fixing is not tolerated even in the coronavirus crisis,” he added.
Germany is Amazon’s second-largest market around the globe after the United States.
A spokesperson for the German Federal Cartel Office has told CNBC, that it is “not up to a private platform to be a price regulator or the price police.” The spokesperson added that the Office suspects Amazon of using “unknown mechanisms” to regulate the prices of products listed on Amazon.
A spokesperson for Amazon has said that “Amazon selling partners set their own product prices in our store… Our systems are designed to take action against price gouging,” they added.
According to a report from CNBC, Amazon had provided the Cartel Office with a statement after it asked Amazon a number of questions. “The responses in the statement are now being considered,” according to the report.
Amazon has previously published a blog post stating that “price gouging has no place in our stores,” and that “Amazon has zero tolerance for price gouging and longstanding policies and systems to prevent this harmful practice.”
Germany’s investigation into Amazon mirrors that of the European Commission who has also launched an antitrust investigation as to whether or not Amazon was using data from independent retailers using the platform; such use of data is a breach of the EU’s competition rules.
Amazon’s Founder and CEO, Jeff Bezos has told a US panel recently that he could not guarantee that Amazon employees had not accessed the selling data of third parties on its marketplace.
According to a report from the Economic Times, “for years, Amazon has been dogged by allegations that it uses its dominance to identify and enter into new product categories using its unique lens into inside information on third party seller data.”