© Marlene Awaad/BloombergMargrethe Vestager, competition commissioner of the European Commission, in Paris on Nov. 21. (Marlene Awaad/Bloomberg)
The concern at hand is whether Amazon's use of sales data from third-party merchants gives it a leg up in selling its own products, said Margrethe Vestager, the European Union's competition chief, on Wednesday. More than half of Amazon's sales now come from third-party merchants that do business on the company's site, as the retailer aggressively recruits small and medium-size sellers to join its marketplace. (Jeff Bezos, the founder and chief executive of Amazon, owns The Washington Post.)
"The question here is about the data," Vestager said at a news conference. "If you as Amazon get the data from the smaller merchants that you host ... do you then also use this data to do your own calculations on what is the new big thing? What is it that people want? What kind of offers do they like to receive? What makes them buy things?"
Amazon declined to comment.
Vestager added that the EU has not formally opened a case but is in the process of gathering information from third-party sellers.
"It is very early days in this antitrust investigation into Amazon's business practices," she said. "We are trying to make sure that we sort of get the full picture."
If the EU intensifies its scrutiny, it could result in years of regulatory headaches for Amazon, along with potential penalties that could force it to change its business practices or even subject the e-commerce giant to steep fines - a fate that Amazon's tech peers know well.
Equipped with expansive consumer protection and competition laws, Vestager has previously penalized Apple for its tax practices, punished Facebook for its privacy missteps and levied a record $5 billion fine against Google in July on grounds that the company had disadvantaged rivals of its Android smartphone platform. Vestager's tough enforcement targeting the tech industry stands in stark contrast to that of regulators in the United States, who often have opted against similar inquiries.
Critics of the tech industry's expansive footprint, however, encouraged Vestager on Wednesday to proceed with the probe - and called on the Trump administration to do the same.
"It's about time. We've been encouraging enforcers on both sides of the Atlantic to do this for a number of years now," said Barry Lynn, the leader of the Open Markets Institute, which has advocated for more antitrust scrutiny of tech giants.
Previously, Vestager has aired antitrust concerns about the way in which tech companies amass vast stores of consumer data - and the competitive advantages that sometimes can result. "Data is an asset," she said in an April interview. "You can mine it; you can work it; you can do completely different things." As a result, Vestager said, regulators think about data as a "completely different creature" than they did five years ago.
Shares of Amazon, which this month became the second publicly traded U.S. company to be valued at $1 trillion, have more than doubled in the past year.
Amazon's stock fell more than 1 percent following the news Wednesday.
Comment: Amazon's relationship with its third-party sellers has been described as 'predatory'. It tracks their transactions and will begin selling many of their most popular items itself. Amazon also uses the transaction information to extract an ever larger cut of their sellers revenue. See: