UK’s competition regulator plans probe into Amazon’s use of data

CMA has recently been focusing on how the online retailer uses data it collects on its platform

The timing and scope of the probe were still being worked on, people with direct knowledge of the plans said. Photograph: iStock

The timing and scope of the probe were still being worked on, people with direct knowledge of the plans said. Photograph: iStock

 

The UK’s competition watchdog is planning a formal competition investigation into Amazon, mirroring a continuing investigation by the EU, according to three people familiar with the situation.

The Competition and Markets Authority (CMA) has been analysing Amazon’s business for months, focusing on how the online retailer uses the data it collects on its platform. It has also scrutinised how Amazon decides which merchants appear in the crucial “buy box” – the white panel to the right-hand side of a product where buyers click to add the item to their cart.

An investigation into Amazon may focus on whether the company favours merchants that also use its logistics and delivery services when deciding who has access to the buy box and to its Prime customers, according to two individuals close to the situation. The timing and scope of the probe were still being worked on.

Both the UK and the EU also recently announced probes into Facebook’s allegedly anti-competitive behaviour. One person at the CMA said the UK watchdog was keen to have a “full portfolio” of cases against big tech companies. The agency had been watching the progress of similar cases in Brussels, the person added.

Job creation

Amazon declined to comment. Last month the company announced it would create 10,000 jobs in 2021, to bring it to a total of 55,000 in the UK alone. The CMA also declined to comment.

The UK investigation was likely to cover similar ground to the investigations under way in Brussels, said people close to the process.

Brussels has two open investigations into Amazon. One is looking at how the company is using data to advance its own products to the potential detriment of rivals. This probe is in its advanced stages but it could still run for another year or longer.

In March the Financial Times revealed that Brussels was struggling to gather sufficient evidence to bring its case against Amazon focused on the way its algorithm boosted its own products over rivals, partly because it had difficulty understanding how the company’s algorithms functioned.

The second, which is less advanced, is looking at the criteria for the use of the buy box. – Copyright The Financial Times Limited 2021