Amazon wins interim court ruling that it isn’t very large online platform (VLOP) under European Union rules
Amazon has received some welcome news in Europe, after a big legal setback in the United States in the past week.
Reuters reported that Amazon won court backing for now in its fight against EU tech rules that label it as a very large online platform (VLOP) under Europe’s recently installed Digital Services Act (DSA), which require it maintain a public ads library or archive for researchers and authorities to access.
It comes after a dire week for Amazon in the US, where the US Federal Trade Commission (FTC) and 17 US states filed a landmark lawsuit alleging monopoly behaviour in its e-commerce operation.
Amazon is also battling the FTC over the Amazon Prime service, after the US regulator sued Amazon in June, and accused it of using “manipulative, coercive, or deceptive user-interface designs known as ‘dark patterns’ to trick consumers into enrolling in automatically-renewing Prime subscriptions.”
But Amazon at the end of this week had some good news when the EU General Court ruled in its favour by agreeing to suspend a requirement under the DSA that Amazon must make an ads library public.
In April 2023, the European Commission had published the names of 19 platforms that will face the strictest level of regulation under the Digital Services Act (DSA), naming 19 so called ‘Gatekeeper’ firms, and Amazon was included in that list.
But in July Amazon refused to accept the VLOP or Gatekeeper designation from European officials, that ranks it alongside other major tech platforms such as Apple, Meta Platforms, and Twitter.
Amazon filed its challenge at the Luxembourg-based General Court, Europe’s second highest court, and is the first challenge from a big name tech player, after German online retailer Zalando sued the European Commission over the same issue in June.
Amazon had asked for an interim measure to suspend Digital Services Act (DSA) requirements on compiling and making public an advertisement repository, and on providing users with an option for each of its recommender systems which is not based on profiling, until the Court rules on its challenge against its label.
Essentially on the ads library issue, Amazon’s legal team had argued the requirement to publish an ads archive would result in the disclosure of confidential information that would cause “serious and irreparable harm to its advertising activities and, by extension, to all its activities”.
The company also claimed the disclosure of the ad information would weaken its competitive position and cause an irreversible loss of market share, as well as harming its ad partners.
And this week the EU General Court agreed with its arguments, Reuters noted.
“The grant of the interim measures requested amounts to no more than maintaining the status quo for a limited period,” judges said in a ruling dated 27 September.
Amazon welcomed the interim measure, calling it an “an important first step that supports our broader position that Amazon doesn’t fit the description of a ‘Very Large Online Platform’ (VLOP) under the DSA, and therefore should not be designated as such.”
However the ruling did not go all of Amazon’s way, after the court dismissed the second part of Amazon’s application, which asked the court to suspend a separate DSA requirement on Amazon to offer users of the store a non-profiling option powering the recommendations it serves them.