FTC readies massive antitrust lawsuit to ‘break up’ Amazon
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San Francisco: The Lina Khan-led Federal Trade Commission (FTC) in the US is reportedly finalising a massive antitrust lawsuit against Amazon, a move that could break up parts of the e-commerce giant.
According to a report in Politico, citing people close to the matter, the “wide-ranging lawsuit is expected as soon as August, and will likely challenge a host of Amazon’s business practices”.
The lawsuit might lead to a court-ordered “restructuring of the $1.3 trillion empire”, the report noted.
The FTC has been investigating Amazon for a long time. Among the potential claims are allegations similar to existing cases like Amazon’s rules requiring third-party retailers to offer their lowest prices on its platform.
“The complaint is likely to focus on challenges to Amazon Prime, Amazon rules that the FTC says block lower prices on competing websites, and policies the FTC believes force merchants to use Amazon’s logistics and advertising services,” the report detailed, citing sources.
Both Amazon and the FTC declined to comment.
On Amazon Prime, the FTC is concerned that the “bundle of services is used to illegally cement the company’s market power”.
The FTC last month sued the e-commerce giant Amazon over alleged 'deceptive' tactics to sign up customers for its Prime service.
The complaint, filed in the federal court in the US city of Seattle, said that for years, Amazon has "knowingly duped millions of consumers into unknowingly enrolling in its Amazon Prime service".
"Specifically, Amazon used manipulative, coercive, or deceptive user-interface designs known as 'dark patterns' to trick consumers into enrolling in automatically-renewing Prime subscriptions," read the FTC complaint.
Amazon Prime costs $139 per year and gives consumers access to free two-day shipping, along with access to Prime Video and music streaming.
"Amazon tricked and trapped people into recurring subscriptions without their consent, not only frustrating users but also costing them significant money," FTC Chair Khan had said in a statement.
"These manipulative tactics harm consumers and law-abiding businesses alike. The FTC will continue to vigorously protect Americans from "dark patterns" and other unfair or deceptive practices in digital markets," she added.
An Amazon spokesperson had said that the FTC's claims are false on the facts and the law.
With inputs from agencies