The Italian Competition Authority fined e-commerce giant Amazon $1.3 billion (1.1 billion euros) on Thursday for abusing its dominance in the online shopping world and harming competing logistics operators through its ‘Fulfillment by Amazon’ (FBA) service.
The AGCM antitrust watchdog was especially concerned about the benefits Amazon provides to sellers on its platform who also pay to use its FBA logistics service.
“The investigation found that these are functions of the Amazon.it platform that are crucial for the success of sellers and for increasing their sales. Finally, the stringent performance measurement system to which Amazon subjects non-FBA sellers is not applied to third-party sellers who use FBA, and failure to pass this can also lead to the suspension of the seller’s account,” the AGCM said in a statement.
Amazon has harmed competing e-commerce logistics operators by preventing them from proposing themselves to online sellers as providers of services of comparable quality to Amazon’s fulfilment, according to the authority.
“These conducts have, thus, increased the gap between the power of Amazon and that of the competition in the e-commerce order delivery business,” the statement read.
In a statement to Engadget, Amazon said: “We strongly disagree with the decision of the Italian Competition Authority (ICA) and we will appeal. The proposed fine and remedies are unjustified and disproportionate.”
According to the Italian watchdog, Amazon must grant all third-party sellers sales and visibility privileges on its platform. Amazon has been given a year to comply with the ACGM’s rulings.
The fine is one of the largest imposed by an EU country for online antitrust violations.
The AGCM fined Apple and Google $11.3 million each last month for violations of the Consumer Code, one for a lack of information and the other for aggressive practises in the acquisition and use of consumer data for commercial purposes.
This was Apple’s second fine from the Italian regulator last month, after it and Amazon were hit with fines totaling around $225 million for restricting who can sell Apple and Beats products on Amazon’s Italian store.
Earlier this month, a major report from a US-based nonprofit organisation claimed that Amazon is abusing its position as a gatekeeper to levy steep and growing fees on third-party sellers, raking in big bucks.
According to the Institute for Local Self-report Reliance’s titled ‘Amazon’s Toll Road,’ Amazon made $60 billion in seller fees last year and will make $121 billion this year.