- The Federal Trade Commission, in collaboration with 17 states, has launched a lawsuit against Amazon, marking a pivotal juncture in an enduring narrative of allegations that the e-commerce behemoth has exploited its economic supremacy, resulting in detrimental consequences for fair competition. To illustrate, the Federal Trade Commission (FTC) asserts that Amazon has, by leveraging its market dominance, impaired competition by compelling sellers on its platform to utilize Amazon's proprietary logistics services to gain access to the coveted seller benefits associated with "Prime" eligibility.
- Furthermore, it alleges that Amazon exerts anti-competitive pressure on sellers to price their products on its platform at the lowest rates available across the entire internet, thereby hindering them from offering their products at more competitive prices on other marketplaces. It's worth noting that this particular practice is already the subject of a separate lawsuit filed against Amazon by California's attorney general in the preceding year.
Why it matters
Due to Amazon's stranglehold on the e-commerce sector, sellers find themselves with limited alternatives but to acquiesce to Amazon's terms, contends the FTC. Consequently, this leads to elevated prices for consumers and an overall suboptimal consumer experience. Additionally, the FTC accuses Amazon of favoring its own products in search results on its marketplace over those sold by third-party sellers.