Amazon.com is scheduled to hold a meeting with the US Federal Trade Commission (FTC) next week, as a potential antitrust lawsuit against the retailer looms on the horizon, according to an insider.
During the previous administration led by Donald Trump, the FTC initiated an investigation into Amazon, Google, Facebook, and Apple for alleged antitrust violations. The probe aimed to determine if these companies were unfairly favoring their own products and discriminating against external sellers on their platforms. Amazon has consistently denied any wrongdoing.
At the upcoming meeting, Amazon is expected to present its case to the commissioners, advocating against the filing of an antitrust suit by the FTC, as revealed by a separate source. Typically, the FTC holds such discussions with companies after conducting in-depth investigations before deciding whether to pursue legal action.
The FTC declined to comment on the specifics of the planned meeting.
A notable figure involved in this matter is Lina Khan, the current chair of the FTC, who, in 2017, authored a Yale Law Journal article titled “Amazon’s Antitrust Paradox.” In the article, Khan argued that the traditional antitrust approach focused on price alone was insufficient for identifying antitrust violations perpetrated by Amazon.
Amazon has faced a myriad of allegations from numerous critics. These include allegations that the company leverages third-party data to curate its product offerings, giving preference to its own goods at the expense of independent sellers on its platform. Moreover, critics claim that Amazon compels Prime sellers to exclusively use its logistics and delivery services.
Furthermore, it has been alleged that Amazon abuses its dominant position by preventing major competitors from advertising against its products on the Amazon platform. Additionally, the company is accused of engaging in below-cost pricing strategies to attract and retain customers, particularly within its Prime membership program.
Amazon, which employs approximately 1.5 million people worldwide, has also faced accusations of labor abuses, such as exerting undue power over its workforce and depressing wages.
In addition to the investigations into Google, Facebook, Apple, and Amazon launched by the Trump Justice Department and the FTC, a House of Representatives panel released a comprehensive report highlighting the dominance of these companies in their respective industries.
The Justice Department has filed two lawsuits against Google, one concerning its search business and the other related to advertising technology. Meanwhile, the FTC has sued Facebook, also known as Meta. None of these cases have yet gone to trial.
In June, the FTC filed a lawsuit against Amazon, alleging that the company illegally enrolled millions of consumers into its paid subscription service, Amazon Prime, without obtaining their consent and making it difficult for them to cancel. Amazon strongly refuted these claims, calling them untrue both factually and legally.
Earlier, in May, the FTC reached a settlement with Amazon’s Ring doorbell camera unit, imposing a fine of $5.8 million. The agency had uncovered instances of the cameras being used for unauthorized spying on certain customers. Additionally, in May, Amazon agreed to pay $25 million to settle FTC allegations that it violated children’s privacy rights by neglecting to delete Alexa virtual assistant recordings upon parental request and retaining them for a longer duration than necessary.
© Thomson Reuters 2023
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