Amazon has reached a settlement with the UK’s competition watchdog regarding its use of Marketplace sellers’ data, but third-party sellers are still unhappy with the ecommerce giant.
The British Independent Retailers Association (BIRA), representing thousands of members, has announced it would be filing a £1.1 billion damages claim against Amazon.
The claim alleges that Amazon illegally misused members’ proprietary data for competitive purposes and manipulated the ‘Buy Box’ to favor its own interests.
Britain’s independent retailers vs Amazon
The ‘Buy Box’, where the ‘Buy Now’ and ‘Add to Basket’ options are housed, uses an algorithm to determine which retailer’s offer is highlighted. With few buyers exploring alternative sellers and instead opting to go for the seemingly preferred retailer, Amazon’s algorithm could have a huge impact on how well retailers perform on the online shopping platform.
Third-party sellers on the platform must also pay a 30% commission to Amazon for each sale made on the platform.
BIRA CEO Andrew Goodacre commented: “if small business want to sell online, Amazon is the dominant marketplace in the UK… Whilst the retailers knew about the large commissions charged by Amazon, they did not know about the added risk of their trading data being used by Amazon to take sales away from them.”
This class action is linked to a 2022 probe by the Competition and Markets Authority (CMA) investigating Amaon’s potential abuse of market power to benefit its retail business over third-party sellers.
Amazon settled with the CMA, agreeing to renewed monitoring and transparency measures.
To complement its class action, BIRA is submitting 1,150 pages of evidence.
Boris Bronfentrinker, representing the retailers, commented: “This is precisely the sort of claim that the new collective action regime was brought in for, to enable small and medium size businesses to be able to recover damages caused to them by a huge multinational.”
TechRadar Pro has asked Amazon for comment, but we did not receive an immediate response at the time of publication.
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