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Tuesday, July 23, 2024

FTC Sues Amazon Over Alleged Anticompetitive Practices

FTC Amazon Antitrust Lawsuit

Did you know that recently, along with 17 state attorneys general, the FTC chose to sue Amazon in a big way on September 26, 2023? A lot of people say that Amazon is using its power to keep costs high and crush the competition. According to the case, this is bad for both customers and small companies that depend on Amazon to sell their goods. The main problem is that Amazon isn’t just big, it’s also said to be taking some pretty unfair actions to stay big and stop other companies from fair play. That is precisely what has led to this FTC Amazon Antitrust Lawsuit. Let’s see the details of the case, shall we?


What Does the FTC Have a Problem With?

Many people don’t like how Amazon treats sellers who offer lower prices on other sites. These sellers can have their goods almost impossible for customers to find on Amazon if Amazon finds out about them doing this. People don’t want to lower their prices elsewhere, so prices stay high.


Further, there is the matter of the Prime badge and Fulfillment by Amazon (FBA). The FTC says that Amazon makes sellers use its expensive FBA service in order to get the Prime badge. For sellers, this is a big deal because it means they will get fast, reliable shipping. It is hard for sellers to find cheaper options because of this.


The FTC doesn’t like how many ads Amazon puts in search results either. There are too many paid ads, so the best goods don’t always show up at the top. Customers have to look through a lot of ads to find what they want.


In particular, if you have seen it somewhere like those Amazon Sub brands that seem to sell the exact copy of some popular products on their platform. And you don’t need to be an expert to know that it looks like a bit shady. And that is precisely what the FTC has a problem with, and why shouldn’t they? There are a lot of sellers out there complaining about the same thing.


Amazon’s Response To This FTC Amazon Antitrust Lawsuit

What did Amazon say in response? Well, as you could have already imagined, they are stating that these actions are necessary for the image of Amazon and to make sure people or customers get what they want.


What Might Come Next?

You see, although the trial is scheduled for October 2026, a settlement may be reached before that date, you know? A couple of things might happen. Amazon may be found guilty and ordered to modify its practices by the court, or it may take the company’s side and allow it to carry on as before. It could be that Amazon also agrees to some modifications without denying wrongdoing as part of a settlement.


Depending on the outcome, the FTC may impose new regulations or heavy penalties. Amazon might face legal action if it continues to engage in tactics such as penalizing merchants with reduced pricing on other sites or requiring them to utilize FBA in order to earn the Prime badge, you know?


Parul is an experienced blogger, author and lawyer who also works as an SEO content writer, copywriter and social media enthusiast. She creates compelling legal content that engages readers and improves website visibility. Linkedin

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