Germany has just questioned the entire Amazon marketplace model. And the implications are … huge
Amazon is again in the eye of the hurricane in Europe. The Bundeskartellamt, the German competition authority, has published a preliminary evaluation that questions the way in which the ecommerce giant It influences the prices established by sellers in their marketplace.
Why Germany investigates Amazon
The investigation revolves around Amazon's pricing control mechanisms, which, according to the German agency, may be infringing both article 102 of the EU operation treaty (TFUE) and articles 19 and 19a of the German Competition Law (GWB). These regulations apply to companies with a significant systemic influence on the digital market, as in the case of Amazon. In fact, according to data from the regulator itself,Amazon.de represents approximately 60% of retail electronic commerce in Germany, with what the weight of its market actions becomes even more relevant.
As we know, the company acts as much as a direct seller (Amazon Retail) and third -party intermediary sellers (Marketplace). Bundeskartellamt explains that this double function implies that Amazon competes directly with external sellers, while Apply rules that affect your ability to compete.
As Andreas Mundt, president of Bundeskartellam, explains: «Amazon competes directly with Marketplace vendors on their platform, and influences the prices of its competitors, even by price stops, which is problematic from the point of view of competition. This applies especially When vendors in question can no longer cover their own costs and the commercial platform is used to hinder the rest of retail retail trade in a way contrary to competence legislation ».
Opaque mechanisms and limited prices on Amazon
According to research, Amazon imposes dynamic and opaque price stops based on algorithms that use internal and external data to determine when a product presents a “price error”, a “significantly high” or simply “non -competitive” price. The consequences can be drastic: product elimination, Buy Box exclusionor one Lower visibility in search results and advertising campaigns.
Recall that Amazon Buybox is the purchase box that appears in the upper right of a product page on Amazon when a customer is ready to make a purchase. This picture contains the “Add to the basket” button or “buy now” and facilitate the purchase of the product by the customer. As you can imagine, being present in this prominent box supposes A vital objective for any seller: Only a seller has control of this space for each specific product at a given time and being in it increases in great conversion.
Risks to competition inside and outside the Marketplace
For the regulator, this system, based on little transparent rules, restricts the freedom of the vendors to fix their own prices and can lead to their costs, which raises the risk of a greater concentration of the market in favor of the Amazon himself.
Andreas Mundt, says that these practices could be designed to coordinate the prices of Amazon's marketplace under a logic dictated exclusively … by Amazon. This strategy not only uniformizes prices but also Dissounts competitionespecially harming sellers trying to compete with lower prices outside the platform.
In addition, the German organism also questions a Amazon practice that has nothing to do with the competition itself, but with the rest of the ecommerce ecosystem: «In particular, the practice of Amazon of systematically match the lowest price of other online stores In all its trade platform it could mean a significant barrier to change and deter other retailers online in prices and offer lower prices, ”explains the statement.
With this Price Matching policy, and taking into account the enormous weight in the local sector, Amazon would put competition at the regional level at risk. If a retailer tries to lower their prices to attract customers, Amazon can quickly adjust their own prices to match them or even lower even more, maintaining market control. This generates a uniform “pricing setting effect”, where real price -based competition is reduced or disappeared, since Sellers cannot differentiate through the price.
What does this case mean for the European Ecommerce
The process, which includes large-scale surveys among the online sellers of the portal in Germany, has coordinated with the European Commission-in the framework of the DMA-and with the Bundesnetzagentur, which monitors compliance with the Regulation of Platform-Empresa Relations. Amazon now has the opportunity to respond to these accusations before a final decision is issued.
But this case could easily jump to other EU countries.
Think about it: Amazon operates with similar models in all large European markets. What we have told you is not strange for Italian, French or, clear, Spanish vendors. Therefore, practices questioned in Germany PThey hate being seen as abusive also in other countries, especially when they affect vendors and consumers throughout Europe.
In fact, the investigation is being carried out in close collaboration with the European Commission, which has competencies to apply the Digital Markets Act (DMA), the regulation for digital platforms with great market power. If Germany concludes that Amazon abuses its position, The commission could open sanctioning procedures or impose obligations at European level.
Image: Flux Schnell
