The Federal Trade Commission (FTC) is gearing up to file a major antitrust lawsuit against Amazon, the e-commerce giant that dominates multiple markets and has been accused of harming consumers, sellers, competitors, and partners. The lawsuit could be filed as soon as this month, according to sources familiar with the matter.
The FTC has been investigating Amazon for years, probing various aspects of its business, such as how it treats its third-party sellers, how it collects and uses customer data, how it competes with other online platforms, and how it leverages its dominance across markets to reinforce its monopoly position. The FTC will meet with Amazon representatives next week, in what could be their last chance to avoid the lawsuit.
“The FTC is giving Amazon its last rites before it files a complaint,” said a source close to the situation.
The FTC chair Lina Khan is known for her critical views on Amazon’s market power and has advocated for breaking up or restructuring the company. In a 2017 paper, Khan wrote that “Amazon is a textbook monopolist: it has monopoly power in multiple markets; it uses that power to exclude competitors and harm consumers; and it leverages its dominance across markets to reinforce its monopoly position.”
Amazon has tried to recuse Khan from the case, arguing that she is biased and has prejudged the outcome. However, the FTC has rejected Amazon’s motion, saying that “We are confident that Chair Khan will review the facts of any matter before her objectively and impartially.”
Amazon has also resisted the FTC’s investigation and refused to cooperate with some of its requests. An Amazon spokesperson said that “Amazon’s conduct has been scrutinized by regulators around the world, and we look forward to a thorough examination of the facts by the FTC.”
The FTC’s lawsuit could have significant implications for Amazon and the online retail industry. The FTC could seek to break up or spin off some of Amazon’s businesses, such as its cloud computing service AWS, its online marketplace, or its streaming service Prime Video. The FTC could also impose behavioral remedies, such as requiring Amazon to stop favoring its own products over those of its sellers, or to stop using customer data to compete with other platforms.
The FTC’s lawsuit could also set a precedent for other antitrust cases against big tech companies, such as Facebook, Google, and Apple. The FTC is not the only agency that is pursuing antitrust actions against Amazon. The Department of Justice, several state attorneys general, and the European Union are also investigating Amazon for possible antitrust violations.
“Amazon is facing a perfect storm of antitrust scrutiny from multiple fronts,” said Sally Hubbard, director of enforcement strategy at the Open Markets Institute. “The FTC is not going to be deterred by Amazon’s attempt to sideline Chair Khan.”
Relevant articles:
– Amazon gets “last rites” from FTC as antitrust complaint looks imminent, Ars Technica, 8/8/2023
– Amazon will reportedly meet with the FTC ahead of potential antitrust lawsuit, Yahoo News, 8/7/2023
– Amazon Meets FTC Regulators As U.S. Considers Antitrust Suit, Forbes, 8/8/2023
– Amazon.com set to meet with US FTC ahead of potential antitrust lawsuit: Source, Channel News Asia, 8/9/2023