California ‘Examines Amazon Business Practices’ In Latest Probe

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The US state investigation adds to Amazon’s regulatory woes, which include investigations by the European Commission and three US federal agencies

The US state of California is looking into Amazon’s business practices as part of a broader inquiry into the company, the Wall Street Journal reported.

The review focuses in part on the way Amazon deals with third-party sellers in its online marketplace, including its practices for selling its own products in competition with third-party sellers, the paper said, citing unnamed sources.

Amazon declined to comment but said in-house products comprise about 1 percent of its total annual retail sales.

The company has said in the past that it follows all laws, while empasising that it only accounts for about 4 percent of total the US retail market.

Image credit: Amazon
Image credit: Amazon

Formal charges

Amazon is facing a number of probes in the US and Europe, with the European Commission planning to file formal antitrust charges over Amazon’s treatment of third-party sellers, reports said late last week.

The EC is reportedly planning to file a formal statement of objections as part of an investigation into Amazon that has been ongoing for nearly two years.

The charges reportedly accuse Amazon of using data from its third-party sellers to compete against those sellers, for instance by launching similar in-house products.

In April, the Journal cited former Amazon staff as saying that the company routinely uses proprietary data from third-party sellers to create competing products.

As a result of the report the House Judiciary Committee called upon Amazon chief executive Jeff Bezos to testify about its private-label practices.

‘Non-public data’

Amazon said it did not believe the report’s claims to be “accurate” and that it prohibits staff “from using non-public, seller-specific data to determine which private label products to launch”.

The company said in May that it was “prepared to make the appropriate Amazon executive available”, without mentioning Bezos.

House Judiciary Committee chairman Jerry Nadler said the company’s response was “unacceptable”.

Aside from the House of Representatives probe, the US’ Justice Department and Federal Trade Commission last year separately met with retailers about Amazon, according to reports.

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