Amazon is being sued again in the UK for unfair competition. The most recent claim, which was made on Thursday, asks the UK’s Competition Appeals Tribunal for more than £2.7BN in damages, which is about $3.4BN at the moment.
The case is being taken by Andreas Stephan, who is a professor of competition law and the head of the Law School at the University of East Anglia. More than 200,000 UK-based Amazon third-party sellers are supporting him.
According to the lawsuit, Amazon has abused its dominant position in the marketplace services it provides to third-party sellers in order to reach customers in the UK. This has been done in a number of ways, such as by favoring its own retail products over those of third parties, favoring its own logistics services (Fulfilled by Amazon, or FBA), and unfairly limiting access to its membership product Prime to those who use FBA.
It is also said that Amazon messes up inter-platform finishing by making it harder for third-party sellers to sell items on other platforms for less money.
In a news release, the complainant says, “Because of these abuses, third-party sellers have lost sales, had to deal with higher costs, and paid Amazon more for its services than they would have under normal times of competition.”
Regional competition authorities have spent a number of years looking into complaints about Amazon’s use of third-party data and how it runs different parts of the marketplace, such as FBA and Prime. So, the charges should be familiar. In the past few years, Amazon has also been charged with trade violations in the US.
As an opt-out collective action, the UK lawsuit includes all qualified sellers unless they say they don’t want to be a part of it. Sellers don’t have to pay to be a part of the claim, but if it wins, any sellers who didn’t choose not to be a part of it will get a piece of any settlement or payout.
The rules say that anyone or any business in the UK that sold to customers in the UK on Amazon with a professional account between June 2018 and June 2024 is eligible. The website for the claim has more information about the lawsuit and a form to sign up for updates.
A big litigation funder called Innsworth Capital Limited is paying for the case. They are also supporting a number of other opt-out collective action lawsuits against tech giants in the UK and Europe, such as a $3.1BN competition claim against Meta and privacy lawsuits against Oracle and Salesforce.
The case will cost Innsworth a lot of money, and he stands to get a cut of any money Amazon may decide to settle for or give in compensation.
Amazon was asked to comment on the UK case, but as of press time, it had not done so.
It’s not the first time that the e-commerce giant has been sued in the UK for competition abuse in the style of a class action. Before the end of the month, the British Independent Retailers Association, on behalf of its many members, filed a similar lawsuit for damages. So, the lawsuit is asking for £1.1BN in damages.
We asked Stephan if he thinks it’s possible for the two UK competition abuse cases to be merged.
As was already said, Amazon has been under antitrust review for years in the UK and Europe because of how it uses data from third-party sellers and because some people think its marketplace is not fair.
In the past few years, the US e-commerce giant has also been accused of unfair competition in its own country. In September of last year, the Federal Trade Commission and the attorneys general of 17 states sued Amazon, saying that it had used a number of unfair monopolistic tactics to stop other companies from competing.
In May 2021, Washington, DC’s Attorney General also filed a claim against Amazon, saying that it stifled competition by controlling third-party sellers and preventing them from selling their goods for less elsewhere. One way that Amazon did this was by setting prices and preventing third-party sellers from selling their goods for less elsewhere.
Amazon ended the EU antitrust investigations in December 2022 without having to pay a fine. It did agree to make some changes to how its marketplace works, though. It reached a similar agreement with the UK’s Competition and Markets Authority in November of last year, but this time it didn’t have to pay a fine for past actions.
Also Read: Uk Stores Have Sued Amazon for £1.1 Billion for Data Abuse
When trade authorities do fines, they only hurt the company, not the people who broke the law. There is a chance for damages claims and lawsuit funders to step in because this type of enforcement doesn’t directly help people who have been abused.
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