Germany’s antitrust authority (Bundeskartellamt) has launched an investigation into whether U.S. ecommerce giant Amazon is exploiting its market dominance in its relations with third-party retailers who use its website as a marketplace.

The Bundeskartellamt initiated an abuse proceeding against Amazon to examine its terms of business and practices towards sellers on its German marketplace amazon.de.

Andreas Mundt, President of the Bundeskartellamt: "Amazon is the largest online retailer and operates by far the largest online marketplace in Germany. Many retailers and manufacturers depend on the reach of Amazon’s marketplace for their online sales. Amazon functions as a kind of “gatekeeper” for customers. Its double role as the largest retailer and largest marketplace has the potential to hinder other sellers on its platform. Because of the many complaints we have received we will examine whether Amazon is abusing its market position to the detriment of sellers active on its marketplace. We will scrutinize its terms of business and practices towards sellers."

The terms of business and related practices which might be considered abusive are liability provisions to the disadvantage of sellers, in combination with choice of law and jurisdiction clauses, rules on product reviews, the non-transparent termination and blocking of sellers’ accounts, withholding or delaying payment, clauses assigning rights to use the information material which a seller has to provide with regard to the products offered and terms of business on pan-European despatch.

A criterion for the relevance of this conduct under competition law is that Amazon holds a dominant position or that the sellers are dependent on Amazon. Bundeskartellamt says that there are indications of both, in particular on a possible market for marketplace services for online sales to consumers.

The proceeding was triggered by numerous complaints from sellers about Amazon’s business practice which the Bundeskartellamt has received in the recent past.

An Amazon spokesman declined to comment on the proceedings beyond saying it was cooperating fully and would continue to work to support the growth of small and medium-sized businesses.

The European Commission has begun investigations based on European competition law into Amazon’s European marketplaces, in particular into Amazon’s collection and use of transaction data. In summer 2018 the Commission sent out extensive questionnaires to several hundred German retailers to this effect.

Whereas the Commission’s investigations focus on Amazon’s use of data to the disadvantage of marketplace sellers, the Bundeskartellamt is examining in particular the company’s terms of business and practices towards sellers on its German Amazon marketplace.

The German antitrust watchdog is also investigating Facebook after finding the social media giant abused its market dominance to gather data on people without their knowledge or consent. Its ruling is expected in the New Year.