Amazon claims that a lawsuit filed by the Attorney General of the District of Columbia would force the company to raise prices.
The District of Columbia filed a complaint against Amazon on Tuesday, alleging that the e-commerce giant participates in anticompetitive practices in its handling of third-party vendors, an allegation that Amazon flatly denied.
Attorney General Karl Racine of the District of Columbia claims in the lawsuit that Amazon has rigged online retail rates by enforcing contract conditions and regulations on third-party sellers. According to the lawsuit, such deals prohibit Amazon sellers from selling their items at cheaper rates on any other network, including their own websites.
The antitrust suit, which seeks to compel Amazon to end potentially unlawful pricing agreements, will “force Amazon to feature higher prices to consumers, strangely going against key antitrust law objectives,” according to the firm.
“The D.C. attorney general has it exactly wrong — sellers set their own prices for the items they carry in our store,” Amazon added in a statement. We reserve the right, like any store, to not highlight deals to customers that are not competitively priced.”
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Amazon, the world’s largest online retailer, manages 50 percent to 70 percent of online business revenue, according to Racine.
In a conference call with reporters, Racine said, “We filed this antitrust lawsuit to put an end to Amazon’s unfair price regulation across the online retail industry.” “We need a fair online marketplace that broadens the choices available to [DC] residents while also encouraging competition, creativity, and choice.”
Amazon, founded by Jeff Bezos, the world’s richest man, is an e-commerce behemoth with forays into cloud computing, personal “smart” technology, and more.
Amazon’s third-party marketplace, where individual retailers list millions of their goods, is a significant part of the company’s revenue. It has over 2 million vendors on its platform, and the company claims that third-party sellers account for more than half of all items sold on Amazon.com.
Amazon also makes money by charging fees to third-party retailers, which brought in $24 billion in sales in the first three months of this year, up 64% from the same time last year.
Amazon, including Facebook, Google, and Apple, is facing a barrage of legal and political attacks from Congress, federal and state authorities, and European watchdogs.
The grievances of merchants who sell goods were the subject of a congressional investigation. This is a condensed version of the information.