DC Attorney General Karl Racine on Tuesday opened an antitrust investigation into Amazon and filed the suit in DC Supreme Court. It is alleged that Amazon has imposed monopolistic policies on third-party sellers on its website. According to the policy, sellers are restricted from offering better deals and prices on other platforms including sellers" own websites. The pricing on Amazon should match the lowest price and best deal available elsewhere.
Attorney General Karl Racine said in a press conference:
Amazon’s policies have prevented competing platforms, including sellers’ own websites, from competing on price and gaining market share. The loss of competition results in less innovation. Amazon has used its dominant position in the online retail market to win at all costs. It maximizes its profits at the expense of third-party sellers and consumers, while harming competition.
Since Amazon"s prices include fees, sometimes as high as 30-40% of the total price, policies like these make prices for the same product more expensive on other platforms. The lawsuit alleges that Amazon prevents third-party sellers from offering products at lower prices on competing platforms which might charge a lower fee than Amazon"s thus allowing the seller to offer a better deal to customers. The lawsuit argues that such agreements lead to an increase in prices and reduces competition and innovation in online retail thereby hurting consumers.
Although Amazon withdrew one of the clauses that dealt with deceptive listing and predatory pricing in 2019, the same provisions were incorporated into the company’s Fair Pricing Policy.
Amazon has found itself on the wrong side previously as well. Amazon copied one of the best-selling items of a third-party seller and listed it under its Amazon Basics brand. The brand called Peak Design mocked Amazon but did not file a legal complaint.
Source: The Verge