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The fine is for for alleged abuse of their market dominance

The Italian Antitrust has levied a hefty fine on Amazon. They said on Thursday they had fined the e-commerce giant 1.13 billion euros ($1.28 billion) for alleged abuse of market dominance.

The sanction decided by the Antitrust Authority is against the companies Amazon Europe Core, Amazon Services Europe, Amazon, Amazon Italia Services and Amazon Italia Logistica for violation of art. 102 of the Treaty on the Functioning of the European Union. This law prohibits “the abusive exploitation by one or more companies of a dominant position on the internal market or on a substantial part of it”.

“Amazon holds a dominant position in the Italian market for intermediation services on marketplaces, which Amazon leveraged to favour the adoption of its own logistics service – Fulfilment by Amazon (FBA) – by sellers active on Amazon.it to the detriment of the logistics services offered by competing operators, as well as to strengthen its own dominant position,” it added.

Protecting e-commerce logistics operators

The investigation found that there are functions of the Amazon.it platform that are crucial for the success of sellers and for increasing their sales. Also, 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.

In doing so, Amazon has harmed competing e-commerce logistics operators, the Authority said. They did this by preventing their competitors from proposing themselves to online sellers as providers of services of a quality comparable to that of Amazon’s fulfillment. This conduct has thus increased the gap between the power of Amazon and that of their competition also in the e-commerce order delivery business.

Furthermore, as a result of the abuse, competing marketplaces have also been damaged: due to the cost of duplicating warehouses, sellers who adopt Amazon logistics are discouraged from offering their products on other online platforms, at least with the same. breadth of range.

The Authority considered this abusive strategy to be particularly serious and, also in consideration of its duration, the effects already produced and the size of the group, decided to impose a fine of over 1 billion euros.