German antitrust probe into Amazon pricing policy (Update)

Feb 20, 2013 by Frank Jordans
In this Dec. 11, 2012 file photo an employee of Amazon works at the company's logistic center in Pforzheim, Germany. Online retailer Amazon reacted to mounting criticism Monday, Feb. 18, 2013, by firing a security company named in a German television documentary about alleged mistreatment of foreign temporary workers. An Amazon spokeswoman in Germany said the company had ended its relationship with Hensel European Security Services "with immediate effect." (AP Photo/dpa, Jan-Philipp Strobel)

Online retailer Amazon may have broken antitrust laws in Germany by banning third-party traders from selling their products cheaper elsewhere, officials said Wednesday.

German antitrust authorities said they have begun questioning 2,400 traders who signed up to Amazon's Marketplace platform, where they can sell products directly to the web giant's millions of users. In return they must abide by its policies.

The probe comes days after Amazon faced criticism in Germany over the alleged mistreatment of temporary workers and in the wake of accusations in the U.K. that it's been avoiding paying tax.

The head of Germany's Federal Antitrust Office said Wednesday there was "considerable" evidence that Amazon's conditions on third-party traders breached cartel rules by unduly hindering its competitors.

"Amazon's price parity clause ... takes away the traders' freedom to offer their products at lower prices elsewhere on the Internet," Andreas Mundt said in a statement.

If the online retailer is found in breach of antitrust rules it could be forced to drop the offending clause, authorities said.

At least one German online retailer welcomed the probe. Ryan Hood, who runs retail site hood.de, claims his business has suffered because Amazon's policy effectively guarantees consumers won't be able to buy certain products cheaper anywhere else on the web.

Hood has filed a legal complaint against Amazon and said he had already held talks with antitrust authorities in October.

Amazon representatives in Germany didn't immediately respond to phone calls and emails requesting comment.

The Seattle-based company has recently been dealing with the fallout from a German television documentary which alleged that some of its temporary workers in the country faced intimidation by security guards, random searches and constant pressure to increase their performance.

Amazon reacted by pledging to investigate the alleged abuse. Earlier this week, the company fired a security subcontractor and a temporary staffing agency implicated in the documentary, which was aired on public television channel ARD.

Last year, Amazon was criticized in Britain for paying 1.8 million pounds ($2.9 million) in tax in 2011 despite sales 207 million pounds. The practice, common among multinational companies, of funneling money through offshore subsidiaries, led the British government to announce a crackdown on legal tax avoidance schemes.

Explore further: Microsoft sheds some of its ad business, mapping service

0 shares

Related Stories

Amazon fires German security firm amid probe

Feb 18, 2013

(AP)—Online retailer Amazon reacted to mounting criticism Monday by firing a security company named in a German television documentary about alleged mistreatment of foreign temporary workers.

Germany demands probe of Amazon work conditions

Feb 17, 2013

A German government minister called Sunday for a thorough probe into allegations that foreign seasonal workers hired in Germany by US online retail giant Amazon were harassed and intimidated.

Group seeks Amazon boycott over sales tax fight

Aug 15, 2011

(AP) -- A coalition of nonprofit groups is calling on customers of Amazon.com to cancel their accounts unless the Internet retailer stops resisting a California law that requires more online retailers to charge a state sales ...

Amazon expands network to Spain

Sep 14, 2011

Amazon expanded its European network to Spain on Wednesday, with a new site amazon.es opened to online shoppers.

Recommended for you

Microsoft sheds some of its ad business, mapping service

8 hours ago

Microsoft is handing off some its digital advertising business to AOL and selling its street-image mapping operation to Uber, as the giant software company tries to focus on activities more relevant to its core business.

Disney merges consumer product, interactive divisions

19 hours ago

Disney is merging its consumer product and interactive divisions, a move that acknowledges the shared goals of important product lines like the Disney Infinity video game franchise and the upcoming line of wearable toys called ...

Justices won't hear Google appeal in dispute with Oracle

Jun 29, 2015

The Supreme Court is staying out of a long-running legal battle between technology giants Oracle and Google over copyright protection for a computer program that powers most of the world's smartphones and computer tablets.

User comments : 0

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.