Amazon accused of illegally raising prices in antitrust lawsuit

Washington, DC Attorney General Karl Racine has filed an antitrust lawsuit against Amazon, claiming the corporate has raised prices unfairly and illegally maintained monopoly power. The suit alleges that Amazon used contract provisions to stop third-party sellers from offering their goods at lower prices elsewhere, consistent with CNBC.

“Today, my office filed an antitrust lawsuit against Amazon for illegally abusing and maintaining its monopoly power by controlling prices across the web retail market and violating DC law,” Racine wrote on Twitter. He said that his office “filed this antitrust lawsuit to place an end to Amazon’s illegal control of costs across the web retail market.” The suit also seeks penalties against Amazon and therefore the recovery of damages. 

Third-party sellers who operate Amazon’s Marketplace got to adhere to the company’s business solutions agreement. In 2019, amid antitrust regulators looking into the difficulty, Amazon removed a provision that banned sellers from offering their products at a lower cost on rival marketplaces. However, consistent with the suit, Amazon added an almost-identical clause to the agreement. thereunder Fair Pricing Policy, Amazon can impose sanctions on sellers that hawk their wares for fewer money elsewhere. 

Those include removing the buy box, pausing the shipment option or suspending or terminating sellers’ accounts. “These agreements also impose an artificially high floor across the web retail marketplace and make sure that high fees charged to third-party sellers by Amazon — the maximum amount as 40% of the merchandise price — are incorporated not only into the worth charged on Amazon, but also into prices on competing platforms,” Racine said.

The Marketplace is a crucial aspect of Amazon’s ecommerce business. It now accounts for half the company’s sales. “The DC Attorney General has it exactly backwards — sellers set their own prices for the products they provide in our store,” an Amazon spokesperson told Engadget during a statement. “

Amazon takes pride within the incontrovertible fact that we provide low prices across the broadest selection, and like all store we reserve the proper to not highlight offers to customers that aren’t priced competitively. 

The relief the AG seeks would force Amazon to feature higher prices to customers, oddly going against core objectives of antitrust legislation.” Other tech giants face growing antitrust scrutiny. Apple is that the subject of a lawsuit from Epic Games during a bench trial that just bound up. A ruling is pending therein case. Several attorneys general and federal agencies have filed suits against Google and Facebook in recent months. Racine’s office goes it alone against Amazon for now, but other states or agencies may join the case later.