Global Courant
The US Federal Trade Commission (FTC) has filed a long-awaited antitrust lawsuit against online retailer Amazon, accusing the company of harming consumers by stifling competition.
The court casewhich was joined by seventeen attorneys general and filed in Amazon’s home state of Washington, follows a four-year investigation.
“The FTC and its state partners say Amazon’s actions allow it to prevent rivals and sellers from lowering prices, lowering quality for shoppers, overcharging sellers, stifling innovation and preventing rivals compete fairly with Amazon,” the FTC said in a statement. rack on Tuesday.
In laying out its charges, the FTC alleged that Amazon engaged in unfair tactics to “illegally maintain its monopoly power” over the online retail industry.
For example, the agency accused Amazon of punishing sellers who offer lower prices elsewhere by burying them “so far beneath” the website’s search results “that they become effectively invisible.” The FTC also said Amazon forces sellers to use its warehouses and delivery services, increasing costs for both consumers and sellers.
The federal agency asked the court to issue a permanent injunction ordering Amazon to stop its unlawful conduct.
“If left unchecked, Amazon will continue its illegal conduct to maintain its monopoly position,” the FTC said in its complaint.
In response, Amazon said the FTC is “wrong on the facts and the law.” It also accused the federal agency of overreach and said the FTC did not promote competition, but rather stifled it.
“The practices the FTC is challenging have helped drive competition and innovation in the retail industry and led to greater selection, lower prices and faster delivery speeds for Amazon customers,” said David Zapolsky, general counsel of Amazon, in a statement declaration.
In a blog post, Amazon noted that it had 500,000 independent sellers on the platform.
“If the FTC gets its way, the result would be fewer products to choose from, higher prices, slower deliveries for consumers and reduced options for small businesses – the opposite of what antitrust law is intended to do,” Zapolsky said.
Amazon was founded in a garage in 1994 and today is worth $1.3 trillion. By some estimates, the company has as much as 40 percent of the e-commerce market.
Tuesday’s legal filing follows similar federal antitrust suits against Google’s parent company Alphabet and Meta, the social media company that includes Facebook, as President Joe Biden’s administration tries to rein in what it sees as big-tech monopolies.
Speaking to reporters on Tuesday, FTC Chair Lina Khan declined to discuss whether the agency would ultimately seek to break up Amazon.
“At this stage the focus is more on accountability,” she said.
While in law school, Khan wrote for The Yale Law Journal about Amazon’s dominance of online retail. She also served on the staff of a House committee that wrote a 2020 report advocating reining in four U.S. tech giants: Amazon, Apple, Google and Facebook.
Under Khan’s watch, the FTC has aggressively sought to dilute the influence of these sprawling tech companies. However, some recent efforts have proven unsuccessful, including bids to block Microsoft’s acquisition of video game maker Activision Blizzard and Meta’s acquisition of virtual reality startup Within Unlimited.
The latest complaint follows other actions the FTC has taken against Amazon in recent months. In June, the agency sued the company, saying it used deceptive practices to sign up consumers for Amazon Prime and made it challenging for them to cancel their subscriptions. Amazon denied the allegations.
In late May, the company also agreed to pay a $25 million civil penalty to settle allegations that it violated the Children’s Privacy Act and misled parents about data deletion practices on its popular voice assistant Alexa.
Critics of the company welcomed the FTC’s latest action.
“No company has ever centralized so much power in so many crucial sectors. Left unchecked, Amazon’s power to dictate and control threatens the rule of law and our ability to maintain open, democratically governed markets,” said Stacy Mitchell of the Institute for Local Self-Reliance, which has urged on government action against Amazon.
