Amazon is the latest target of Europe’s crackdown on the power of big tech
(CNN) — The European Union will investigate how Amazon uses data from independent sellers, continuing an aggressive regulatory push that has already ensnared Google, Facebook and Apple.
Margrethe Vestager, the European Commission’s top antitrust official, had previously signaled that she would examine whether the giant online retailer’s use of data violates competition rules.
How tech companies use data is becoming a major focus for regulators on both sides of the Atlantic. US lawmakers earlier this week subjected tech executives to tough questions on the subject.
Vestager said in a statement on Wednesday that e-commerce had boosted choice for consumers and reduced prices.
But she cautioned that “we need to ensure that large online platforms don’t eliminate these benefits through anti-competitive behavior.”
“I have therefore decided to take a very close look at Amazon’s business practices and its dual role as marketplace and retailer, to assess its compliance with EU competition rules,” she said.
The Commission will investigate standard agreements between Amazon and independent retailers that use its massive platform, and whether the seller data is used by Amazon unfairly.
It will also look into the role of data when Amazon selects its “Buy Box” search results.
The probe could drag on for years and expose Amazon to potential fines of up to 10% of its annual global sales. That implies a maximum penalty of $23 billion based on 2018 revenue.
In a statement, Amazon said: “We will cooperate fully with the European Commission and continue working hard to support businesses of all sizes and help them grow.”
The European Union has emerged as a key battleground for tech because of its tough rules on data protection, hate speech, taxation and competition issues. Apple, Amazon and Facebook have all come under scrutiny.
In March, the bloc hit Google with a third antitrust penalty, ordering it to pay €1.5 billion ($1.7 billion) for abusing its dominant position in online search advertising. It’s been fined €8.2 billion ($9.2 billion) in total by Europe since 2017.
Spotify asked the bloc’s antitrust regulators to intervene in a dispute with Apple over its App Store in March.
Vestager previously examined Apple’s purchase of music app Shazam but eventually approved the deal. And in 2016, the European Union ordered Apple to repay €13 billion ($14.6 billion) in tax breaks to Ireland.
Ireland’s Data Protection Commission is investigating Facebook over data breaches and other issues.
Meanwhile, pressure on tech companies is building in the United States.
The US Federal Trade Commission is reportedly preparing to fine Facebook roughly $5 billion for mishandling user data. Meanwhile, the US Justice Department is laying the foundation for a potential antitrust investigation of Google.