Amazon.com is set to meet next week with the US Federal Trade Commission (FTC) ahead of a potential long-awaited antitrust lawsuit against the retailer, according to a source familiar with the matter.
The FTC began probing Amazon during former President Donald Trump’s administration when the government decided to investigate Amazon, Google, Facebook, and Apple for allegedly breaking antitrust law. The company has been criticized for allegedly favoring its own products and disfavoring outside sellers on its platform, among other allegations. Amazon has denied wrongdoing.
Amazon is expected to argue at the meetings with the commissioners that the FTC should not file an antitrust suit against the company, a separate source said. The FTC typically holds meetings with companies after lengthy investigations before deciding whether to file a suit.
The FTC declined to comment on the planned meeting.
Before becoming FTC chair, Lina Khan in 2017 wrote a Yale Law Journal article tiled “Amazon’s Antitrust Paradox,” which argued that the traditional antitrust focus on price was inadequate to identify antitrust harms done by Amazon.
Amazon has faced a range of allegations from a long list of critics, including using third-party data to decide which products to sell, preferencing its goods to the detriment of independent sellers on the Amazon platform, and requiring Prime sellers to use Amazon’s logistics and delivery services.
Other critics have said Amazon abused its gatekeeper power by refusing to allow big rivals to advertise against its products on the Amazon platform and used below-cost prices on goods and services to keep customers, including on Prime.
The company, with about 1.5 million employees globally, has also been accused of abusing its power on labor and depressing wages.
After the Trump Justice Department and FTC opened probes into Alphabet’s Google, Meta’s Facebook, Apple, and Amazon, a House of Representatives panel released a major report that discussed how those companies dominate their industries.
The Justice Department has sued Google twice, once regarding its search business and a second time on advertising technology. The FTC has sued Meta’s Facebook. None of those cases has yet gone to trial.
The FTC in June sued Amazon, accusing it of enrolling millions of consumers into its paid subscription Amazon Prime service without their consent and making it hard for them to cancel. Amazon called the FTC’s claims “false on the facts and the law.”
The FTC on May 31 announced a $5.8 million (roughly Rs. 48 crore) settlement with Amazon’s Ring doorbell camera unit after the agency said cameras had been used for spying on some customers. Amazon also agreed in May agreed to pay $25 million (roughly Rs. 206 crore) to settle FTC allegations it violated children’s privacy rights by failing to delete Alexa virtual assistant recordings at the request of parents and keeping them longer than necessary.
© Thomson Reuters 2023
