Amazon risks fines in UK and EU

The British competition watchdog is about to launch an investigation into Amazon. Meanwhile, the European Union is threatening the e-commerce giant with a hefty fine.

“Buy box”

The Competition and Markets Authority (CMA) would like to start a formal investigation into Amazon, writes Charged Retail. Allegedly, the British competition authority has kept a close eye on the American company for several months. 

The central issue is how Amazon uses the data which it collects from buyers and sellers. Furthermore, the investigation would focus on how the web giant decides which sellers appear in its coveted “buy box”, the box on the right-hand side of a product page allowing shoppers to immediately add the product to their basket.

Around 82 per cent of all purchases are made through this buy box, but only certain sellers with high sales figures are believed to appear in it. The CMA wants to find out how these sellers are selected and whether Amazon favours sellers who also use Amazon’s logistics service.

Europe

The EU is also currently conducting two antitrust investigations into Amazon, examining whether the company is using its seller data to promote its own products and also investigating the sales box.

Meanwhile, Luxembourg’s Data Protection Commission (CNPD) has a draft decision-ready in which it wants to impose a fine of around 350 million euros on Amazon for violating European GDPR rules. This is reported by The Wall Street Journal. The CNPD is the main privacy regulator for Amazon in the EU because the company has its European headquarters in the Grand Duchy.

Before the draft decision can become final, it must be effectively approved by other privacy regulators in the EU, a process that could take months and can lead to substantial changes, including a higher or lower fine.