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Business News/ Companies / News/  Amazon faces antitrust lawsuit from FTC, 17 US states
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Amazon faces antitrust lawsuit from FTC, 17 US states

The FTC and its state partners say Amazon’s actions allow it to stop rivals and sellers from lowering prices, degrade quality for shoppers, overcharge sellers, stifle innovation, and prevent rivals from fairly competing against Amazon

Amazon’s illegal, exclusionary conduct makes it impossible for competitors to gain a foothold, the lawsuit said (Photo: Reuters)Premium
Amazon’s illegal, exclusionary conduct makes it impossible for competitors to gain a foothold, the lawsuit said (Photo: Reuters)

The Federal Trade Commission (FTC) and 17 state attorneys general Tuesday sued Amazon alleging that the e-commerce giant is a monopolist that uses a set of interlocking anticompetitive and unfair strategies to illegally maintain its monopoly power.

The FTC and its state partners say Amazon’s actions allow it to stop rivals and sellers from lowering prices, degrade quality for shoppers, overcharge sellers, stifle innovation, and prevent rivals from fairly competing against Amazon. 

The lawsuit, filed in US District Court for the Western District of Washington, alleges that by stifling competition on price, product selection, quality, and by preventing its current or future rivals from attracting a critical mass of shoppers and sellers, Amazon ensures that no current or future rival can threaten its dominance. 

Amazon’s far-reaching schemes impact hundreds of billions of dollars in retail sales every year, touch hundreds of thousands of products sold by businesses big and small and affect over a hundred million shoppers, the complaint said.

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Amazon’s illegal, exclusionary conduct makes it impossible for competitors to gain a foothold. With its amassed power across both the online superstore market and online marketplace services market, Amazon extracts enormous monopoly rents from everyone within its reach, the complaint read

“Our complaint lays out how Amazon has used a set of punitive and coercive tactics to unlawfully maintain its monopolies," FTC Chair Lina M. Khan said

“The complaint sets forth detailed allegations noting how Amazon is now exploiting its monopoly power to enrich itself while raising prices and degrading service for the tens of millions of American families who shop on its platform and the hundreds of thousands of businesses that rely on Amazon to reach them. Today’s lawsuit seeks to hold Amazon to account for these monopolistic practices and restore the lost promise of free and fair competition," FTC chair added.

 “We’re bringing this case because Amazon’s illegal conduct has stifled competition across a huge swath of the online economy. Amazon is a monopolist that uses its power to hike prices on American shoppers and charge sky-high fees on hundreds of thousands of online sellers," said John Newman, Deputy Director of the FTC’s Bureau of Competition.

“Seldom in the history of U.S. antitrust law has one case had the potential to do so much good for so many people" he added.

The FTC, along with its state partners, are seeking a permanent injunction in federal court that would prohibit Amazon from engaging in its unlawful conduct and pry loose Amazon’s monopolistic control to restore competition.

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Published: 26 Sep 2023, 11:37 PM IST
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