Amazon is embroiled in a collective lawsuit initiated by over 200,000 UK third-party sellers. The lawsuit alleges anticompetitive practices that favour Amazon’s interests.
- Andreas Stephan, a competition law professor, leads the lawsuit representing UK sellers.
- Amazon is accused of exploiting its dominant position to benefit its own retail and logistics services.
- The case highlights the significant financial impact and increased operational costs faced by third-party sellers due to Amazon’s practices.
- Amazon’s net income sharply contrasts with the reported losses and challenges experienced by third-party sellers.
Andreas Stephan, a professor of competition law at the University of East Anglia, is leading a significant lawsuit on behalf of over 200,000 third-party sellers in the UK. The claim was filed at the competition appeal tribunal and asserts that Amazon has leveraged its dominant position in the UK’s e-commerce market to prioritise its own retail offers and logistics services, specifically Fulfilment by Amazon.
The collective ‘opt-out’ action automates the inclusion of all affected third-party sellers, a strategic move considering the widespread nature of the alleged harms and the limited capacities of individual sellers to legally oppose Amazon. Stephan argues that Amazon has enacted several strategies that bolster its platform while restricting competitors and exploiting third-party sellers.
Among the tactics cited are the imposition of unfair conditions to access Amazon Prime and hindering third-party sellers from offering lower prices on alternative platforms. According to Stephan, these practices have resulted in lost sales, increased costs, and higher fees for third-party sellers than would be expected under normal competitive conditions.
Stephan contends that many independent sellers are heavily reliant on Amazon’s platform, thereby becoming particularly vulnerable to such exploitative practices. The lawsuit depicts a grim scenario for these sellers, marked by significant income loss and elevated operational costs. Meanwhile, Amazon’s financial disclosures reveal a contrasting picture, with the company’s net income increasing to $10.4 billion in the first quarter of this year, a near tripling from the prior year’s figures on a 13% rise in revenue to $142.4 billion.
The goal of the lawsuit, as stated by Stephan, is not only to seek compensation for the UK sellers but also to advocate for fairer treatment by Amazon in the future. This viewpoint is supported by industry authorities like Stephen Robertson, former director general of the British Retail Consortium, and Damien Geradin, a solicitor specialising in digital marketing law, who have recognised similar patterns of Amazon’s market dominance abuses acknowledged by both EU and UK competition bodies.
In response to the lawsuit, an Amazon spokesperson expressed confidence that the claims are without merit and would be dismissed through the legal process.
The outcome of this high-stakes legal battle could have far-reaching implications for UK third-party sellers and the broader e-commerce landscape.
