On Thursday, Attorney General of Washington DC, Karl Racine sued Amazon over antitrust allegations.
The allegations against the world’s largest online marketplace were that their agreements with third-party sellers were quite restrictive by limiting the sellers from selling their products for a lower price on other online market places. This would in turn create an artificial inflation, while reducing competition.
According to the suit, it states that Amazon has been outright prohibiting their third-party sellers from selling their merchandise at a lower rate anywhere else since 2019. The company also charges third-party sellers a fee of 40% of their product price.
If the sellers did however, put up their products on a different site for a cheaper price, amazon would take them off their site. When investigations for the same were being conducted, Amazon temporarily removed that rule, eventually replacing it with a replica.
The lawsuit also claims that Amazon having control of about 70% of US online sales eventually leads to consumers having to pay higher prices on their site.
In response to these allegations, Amazon made a statement claiming that attorney general Racine “has it exactly backwards. Sellers set their own prices for the products they offer in our store. And like any store we reserve the right not to highlight offers to customers that are not priced competitively.”
Even though this lawsuit has been filed only in DC and not in federal court, it still makes this lawsuit an important one grouping Amazon with Google and Facebook, all three having being sued with antitrust lawsuits.
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