[Asia Economy Reporter Yujin Cho] Amazon, the world's largest e-commerce company, has been sued on charges of artificially controlling consumer prices by abusing its monopoly power. This antitrust lawsuit targeting Amazon is expected to open a new front in the comprehensive antitrust regulatory movement against major IT giants such as Facebook and Google.
According to Bloomberg News on the 25th (local time), Karl Racine, the Attorney General of Washington DC, filed a lawsuit in the Washington DC court based on antitrust laws, claiming that Amazon's business practices unfairly raised consumer prices and suppressed innovation. The reason is that Amazon engaged in unfair practices by controlling prices through its monopoly position.
According to the complaint, Amazon maintained its illegal monopoly by including provisions that prohibit third-party retailers selling on its platform from offering products at lower prices on other platforms. Amazon, which accounts for 70% of the US e-commerce market, used this contractual method to artificially inflate prices in the online market.
Attorney General Racine argued, "Because of this contract between Amazon and the retailers, an artificially high price floor was established across all online retail markets, which reduced competition, innovation, and choice, harming both consumers and retailers."
In 2019, when moves to regulate antitrust behavior began to become visible, Amazon avoided regulatory scrutiny by simply renaming the 'price parity clause' to the 'fair pricing policy.'
For the past two years, the US Department of Justice, the FTC, and California have also been investigating whether Amazon engaged in antitrust behavior.
Bloomberg News predicted that this antitrust lawsuit targeting Amazon will open a new front in monopoly investigations against big tech companies. Attorney General Racine also hinted at the possibility of other states or the federal government joining in the future. Previously, the Department of Justice and state attorneys general filed an antitrust lawsuit against Google in October last year, and the Federal Trade Commission (FTC) and state attorneys general filed a similar antitrust lawsuit against Facebook in December last year.
In response, Amazon stated, "The Washington DC Attorney General has completely misunderstood the situation," and argued, "Sellers set the prices of their products themselves in our marketplace." It added, "The remedy sought by the Attorney General would ironically force Amazon to charge customers higher prices, which goes against the core goals of antitrust laws."
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