The long-awaited antitrust complaint against Amazon from the Federal Trade Commission has been filed.
The Federal Trade Commission (FTC) and solicitors general from 17 states charged Amazon with abusing its “monopoly strength” by raising prices, lowering customer satisfaction, illegally excluding competitors, and generally harming competition.
In afternoon trade, Amazon stock dropped as much as 3%.
In order to “illegally preserve” its monopoly position, Amazon has been using a two-pronged strategy, according to the agency. The FTC cited the company’s purported anti-discounting practises as a way to punish vendors and discourage other online merchants from undercutting Amazon’s rates. As a result, the FTC claimed, prices are kept high for goods on the internet.
In order to receive the coveted Prime label for their products, Amazon also “essentially compels” that sellers use its “expensive” fulfilment services, according to the FTC. This makes operating a business on the platform more expensive. FTC Chair Lina Khan informed reporters at a briefing on Tuesday that sellers are paying Amazon $1 out of every $2 sold.
Source (CNBC)
