German cartel watchdog starts investigation into Amazon dominant position

The German Bundeskartellamt starts an investigation into possible abuse of power by Amazon. The cartel watchdog is investigating whether Amazon has a ‘material influence’ on the competition. If so, Amazon could be punished for “anti-competitive practices.”

According to the cartel watchdog, Amazon has so much influence on competition in various markets that the company should be scrutinized. The investigation is aimed at finding evidence that Amazon is so powerful in certain markets that competitors have virtually no chance. The Bundeskartellamt can do that because it has had new powers since January to tackle large tech companies. This allows the watchdog to intervene earlier if it judges that a large tech company is making improper use of its dominant position.

With the new powers, the cartel watchdog can prohibit tech companies from engaging in anti-competitive practices, such as prioritizing themselves or making it more difficult for others to enter a market by, for example, processing all the relevant data a competitor would need.

The Amazon investigation is the second investigation conducted by the Bundeskartellamt under the new powers. In December, it launched an investigation into Facebook because Facebook requires Oculus users to have a Facebook account. With the powers, it was able to broaden the investigation into Facebook’s dominant position in January.

In addition to these, the watchdog has two other cases pending against Amazon. In one case, he is investigating whether Amazon influences the prices of sellers on Amazon Marketplace with, for example, algorithms. The other case looks at agreements between Amazon and manufacturers that bar third parties selling on Market Place from selling certain products.