European countries have been cracking down on Silicon Valley, and now Amazon faces a double barrel of regulatory blasts from Germany and Britain.
Amazon (AMZN) – Get Amazon.com Inc. Report is having a tough week across the pond.
The e-commerce giant has been in the crosshairs of European regulators for years. Now, coming out of the July 4 weekend, Amazon has a host of new headaches to deal with.
Britain’s Competition and Markets Authority, the country’s antitrust watchdog, opened an investigation this week into whether Amazon is taking anti-competitive measures that affect sellers on its marketplace and could result in worse deals for its customers.
“It’s right that we carefully investigate whether Amazon is using third-party data to give an unfair boost to its own retail business and whether it favors sellers who use its logistics and delivery services – both of which could weaken competition,” Sarah Cardell, general counsel at the CMA, said in a statement.
An Amazon spokesperson told Reuters that the company would assist the CMA with its investigation.
But the Britain isn’t the only part of Europe where Amazon is having regulatory trouble.
Germany Watching Amazon Closely
Germany’s Federal Cartel Office on Wednesday said that Amazon’s position is of outstanding, cross-market importance for competition, meaning that the company needs to be reviewed more closely to prevent any anti-competitive behavior.
The FCO also said it considers Amazon to be dominant in its marketplace services for third-party merchants.
“This means that the classic abuse control, which is applicable in parallel and on the basis of which we are currently already conducting proceedings against Amazon, also applies here,” it said.
Last year, Germany changed antitrust laws for digital corporations and gave the Cartel Office more power to monitor and regulate the dominant positions of some companies.
Amazon told Reuters that its market position in German e-commerce represents on 15% of the market.
Europe Takes Aim at Silicone Valley
It’s not just Amazon facing scrutiny in Europe as Silicon Valley companies like Alphabet (GOOGL) – Get Alphabet Inc. Report don’t seem very welcome in Europe either.
Alphabet’s Google unit is still fighting a $1.6 billion (1.49 billion euro) European Union fine imposed by EU antitrust regulators from three years ago. The EU charged Google with hindering online search advertising from rivals.
That fine is just one of three actions the EU has taken against the internet giant, totaling $8.8 billion (8.25 billion euro).
In 2021, the company lost its court fight against a $2.8 billion (2.42 billion euro) fine after EU regulators ruled in 2017 that Google had pushed its own shopping services on its platforms. The company contested the ruling, leading to a years-long review process.
But those fines pale in comparison to the $5 billion (4.34 billion euro) fine that the EU levied against Google in 2018 that the company is still fighting.
Meanwhile back in the U.K., the CMA said that it is investigating whether Microsoft’s (MSFT) – Get Microsoft Corporation Report $75 billion bid for videogame maker Activision (ATVI) – Get Activision Blizzard Inc Report would reduce competition in Britain.
In a statement to the Wall Street Journal, Microsoft said that the company would cooperate with the investigation while assuring that the merger would be beneficial to both videogame players as well as the videogame industry.
