The investigation is probing whether the e-commerce giant is using merchant data to gain a competitive advantage. The move came hours after Germany said it was dropping a seven-month antitrust probe into Amazon.
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The European Union opened an antitrust investigation into Amazon on Wednesday over whether the online retail giant misused merchant data on its website.
Margrethe Vestager, the EU's antitrust commissioner, said Wednesday that she is taking a "very close look at Amazon's business practices and its dual role as marketplace and retailer, to access its compliance with EU competition rules."
A preliminary probe launched last year showed that Amazon "appears to use competitively sensitive information — about marketplace sellers, their products, and transactions on the marketplace." That information could give the US e-commerce giant a competitive edge, Vestager said.
"We need to ensure that large online platforms don't eliminate these benefits through anti-competitive behavior," Vestager said.
Amazon on Wednesday said that it would cooperate fully with the EU investigation.
The EU has recently pushed to address the dominance of US tech firms. During Vestager's five-year term, her office has handed down a combined $9.5 billion (€8.5 billion) in antitrust fines to Google. Regulators in Brussels have also scrutinized Apple and Facebook for breaches of competition, tax and data rules.
German antitrust watchdog drops probe
The announcment from the EU's antitrust authority came after Germany's Federal Cartel Office (BKA) said on Wednesday that it would drop a seven-month investigation into Amazon after the company agreed to agreed to overhaul its terms of service for third-party merchants.
The BKA said it was satisfied with Amazon's decision to amend a Business Services Agreement that applies to hundreds of thousands of merchants that trade on its platform. Amazon said the changes, which would take effect in 30 days, would clarify the rights and responsibilities of selling partners, which account for 58% of the US retailer's merchandise sales on its platform.
The BKA said the changes would not only apply to Germany, Amazon's second largest market after the United States, but also to other European markets such as the UK, France, Italy and Spain as well as other worldwide markets in America and Asia.
"We have achieved far-reaching improvements for retailers on Amazon's marketplaces," BKA head Andreas Mundt said in a statement. "We are dropping our investigation."
EU: the great antitrust busters
Don't be evil? The EU seems to agree, particularly going by the manner in which it fines the big US software companies when they fall foul of the bloc's laws. Since 2004, penalties for transgressions have risen markedly.
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Microsoft tread the Windows ledge
In 2004, the European Commission finished a five-year investigation into Microsoft and concluded that the US tech giant had exploited a monopoly on PC operating systems. The fine was €497 million ($579 million). Within 90 days, Microsoft was obliged to offer a Windows product without its 'Mediaplayer' product.
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Another blow for Bill and Co
In 2007, the European Commission went for Microsoft again, this time imposing a fine of €900 million. The reason was that they reckoned Microsoft had charged competitors unjustifably high license fees to avail of technical information. This violated previously agreed EU requirements.
Image: picture-alliance/AP Photo/T.S. Warren
Intel Inside Job
In 2009, a record fine was issued with the breaking of the €1 billion barrier. This time, it was the chipmaker Intel, fined €1.06 billion in what was part of a near-decade long dispute over cartel activity. The EU said that Intel had abused its market position by obliging clients such as Saturn and Media Markt to sell PCs made with Intel chips.
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Just browsing, and just one browser...
In 2013, Microsoft had to dole out another €561 million to the EU. This time, the company was accused of failing to offer an adequate choice of browser to its customers, as it had promised it would a few years earlier. The Commission said that from May 2011 to July 2012, Microsoft had failed to do this.
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To Infineon - €100 million - and beyond!
In 2014, the European Commission slapped a fine of €138 million on four different chip manufacturers, including the Munich-based company Infineon, which had to pay the vast majority of the total amount. Their sin was that between September 2003 and September 2005, they had engaged in price controlling activity with the likes of Philips and Samsung.
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Ok Google, stop manipulating search results
In 2017, Google was ordered to pay a whopping €2.42 billion fine into the EU coffers, with the Commission accusing the search kingpin of manipulating online shopping searches, abusing its market position as a result. The specific transgression was that Google had prioritised its own services' price comparisons in search results ahead of its competitors.
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Qualcomm eats the forbidden Apple
In 2017, Qualcomm, a chip supplier of US behemoth Apple, had to pay €997 million to the EU. The accusation was that the US company had been paying a fortune to Apple in order to thwart its own competitors. It meant that Qualcomm had abused an already dominant position to exclude other LTE chipset makers from the market.
