Amazon Handed $1.7B Fine by Italian Authorities for ‘Harmful’ Practices

Power Retail By Power Retail | 14 Dec 2021

Amazon has been issued a fine of €1.1 billion (AUD 1.74 billion) by the Italian market authority, AGCM, alleging that Fulfilment by Amazon (FBA) is abusing its powers and disadvantaging its competitors. 

The Italian antitrust probe has accused FBA of ‘harmful’ practices, ultimately abusing its dominant position of power.

According to the Italian AGCM, Amazon expanded its freight services with the hopes of market dominance and disadvantages the third-party merchants that do not use the FBA logistics. As such, the sellers that don’t use the FBA services miss out on benefits including increased visibility on the website, access to the Prime label and

“Amazon holds a dominant position in the Italian market for intermediation services on marketplaces, which Amazon leveraged to favour the adoption of its own logistics service,” said the watchdog in a statement.

Last month, Amazon lost a court bid with the European Union to prevent and EU and Italy from running parallel investigations into the e-commerce platform, and how it treats its sellers. The European Commission will look at the way Amazon selects its retailers for the highlighted box. This feature attracts roughly 80 percent of sales.

In response to the fine and probe, a statement from Amazon explained its dissatisfaction with the decision. “We strongly disagree with the decision of the Italian Competition Authority and we will appeal,” the statement read.

“When sellers choose FBA, they do so because it is efficient, convenient and competitive in terms of price. Small and medium-sized businesses have multiple channels to sell their products both online and offline: Amazon is just one of those options. The proposed fine and remedies are unjustified and disproportionate.”

On the first day of Xmas, Power Retail gave retailers amazing benchmarking insights. 🎄 Power Retail is celebrating the holiday season with 12 Days of Switched On – we’ll show you 12 ways the Switched On membership can boost your performance. Find out more about Switched On here.

0 Comment

Leave a Reply

Your email address will not be published. Required fields are marked *