Amazon Could Face the Heat of EU Probe Next Year
While European antitrust authorities engage in a case engulfed in historic regulations, Amazon could step into the hotwaters of an EU probe next year regarding whether it favors its own brand products on its online marketplace.
The EU's Digital Markets Act (DMA) enforcement, a regulation aimed at reducing the power of Big Tech firms, could be greatly aided by the reported investigation.
If caught going against the DMA, Amazon could be slammed with 10 percent penalty from its yearly global turnover.
Since the DMA rules that big tech platforms are prohibited from favoring their own goods and services. The rule is only applicable for companies that have been deemed as "gatekeepers" based on their substantial market power.
Amazon, which happens to be a gatekeeper under the DMA, has been working with EU authorities.
It claimed to be in compliance with the DMA and that it has cooperated with the Commission on its plans ever since two of its services were identified as crucial conduits between companies and customers, making them subject to the new regulations.
Teresa Ribera, who is reportedly said to take over as EU antitrust commissioner next month, will give her word on opening a formal probe. Margrethe Vestager, a well-known figure in EU competition enforcement, will be replaced by Ribera.
According to reports, Ribera will decide in the upcoming months whether to move further with the case.
If caught going against the DMA, Amazon could be slammed with 10 percent penalty from its yearly global turnover.
Amazon emphasized in its March compliance report that its ranking algorithms do not differentiate between products sold by third-party merchants and those under its own brand. According to the paper, "Our ranking models do not differentiate on whether the product is an Amazon product or a third-party product, or whether it is sold by Amazon Retail or a seller."
There are other tech behemoths being investigated besides Amazon. The DMA is also being used to investigate other businesses, such as Apple, Google, and Meta Platforms. Sources say Ribera will replace Vestager as the person in charge of making decisions in these cases.