EU launches antitrust probe into Amazon’s e-book services
Thu 11 Jun 2015
As the Transatlantic Trade and Investment Partnership (TTIP) ignites into publicly-generated controversy, the European Union launches another flank at one of its favourite investigative targets. Today the European Commission has announced the opening of a fresh investigation aimed at Amazon.com, Inc., this time looking into allegations that the Seattle-based global publishing, delivery and digital services giant may be using its dominant position as the world’s largest e-book publisher to hobble possible competitors.
In a statement EU Commissioner in charge of competition policy Margrethe Vestager describes her duty to “make sure that Amazon’s arrangements with publishers are not harmful to consumers, by preventing other e-book distributors from innovating and competing effectively with Amazon. Our investigation will show if such concerns are justified,”
The objection stems from certain clauses that Amazon include in their e-book contracts with publishers. The clauses oblige the party signing to make Amazon aware if the publishers in question offers competitive, identical or better deals to another publisher besides Amazon, and then to match such a deal with Amazon itself.
Amazon responded to the announcement about the investigation, stating “We look forward to demonstrating this to the Commission as we cooperate fully during this process,”
The European’s Commission’s statement itself notes that this is not the its first investigation in the e-book sector – in late 2011 the EC opened an enquiry into possible price collusion between Apple and international publishing houses Penguin Random House, Simon & Schuster, Hachette Livres, Georg von Holtzbrinck Verlagsgruppe and HarperCollins. Over the next 18 months all the parties involved provided satisfactory assurances to the commission.
Last month it was revealed that Amazon.com’s German branch paid just 11.9 million euros (approx. £8.5 million) in tax in 2014 despite reporting $11.9 billion of gross sales in Germany in 2014.
In January preliminary findings from the European Commission’s investigation into Amazon’s ‘sweetheart tax deal’ with Luxembourg concluded that the company may owe billions in unpaid tax after paying only £4.2mn of tax on £4.3bn of turnover during 2013.