35,000 sellers claim Amazon misuses data for cheaper rival products
Independent UK retailers have initiated the largest ever retail class action with a £1bn damages claim against Amazon, alleging the company has been excluding them from its online marketplace.
About 35,000 sellers, led by the British Independent Retailers Association (Bira), assert that from October 2015 to the present, Amazon used their non-public data to develop and launch competing products.
The claim also states that Amazon manipulated access to its “buy box,” where most platform sales occur, to steer shoppers from independent retailers to its own products.
Bira noted that Amazon already charges its members a “non-negotiable 30% commission on every product sold on the site” and alleges that Amazon’s misuse of proprietary data to market cheaper rival products is driving many UK independent retailers out of business.
The consequences of Amazon’s abusive conduct have been to inflate its profits and harm the UK retail sector, especially smaller independent retailers struggling during difficult economic times,” said the trade body.
Bira announced it would file over 1,150 pages of documents with the Competition Appeal Tribunal (CAT) in London detailing the claim against Amazon.
Andrew Goodacre, Bira’s chief executive, remarked: “Why would an independent retailer use Amazon if it is so damaging to their business? The reality is, consumer buying behaviour has shifted significantly, and Amazon is the dominant online marketplace in the UK. For small retailers with limited resources, Amazon is the primary platform to start online trading.
An Amazon spokesperson responded: “We have not seen this complaint, but based on the reporting so far, we are confident it is baseless and will be proven so in the legal process. Over 100,000 small and medium-sized businesses in the UK sell on Amazon, with more than half of all physical product sales on our UK store coming from independent sellers. We only succeed when the businesses we work with succeed.”
In 2022, the UK’s Competition and Markets Authority (CMA) launched an investigation into whether Amazon was giving its own brands and those using its logistics services an unfair advantage over third-party rivals on its marketplace. This UK investigation, along with a similar one by the EU Commission, followed reports alleging Amazon used third-party sellers’ data to copy products.
In November last year, the investigation concluded after Amazon agreed to give independent sellers a fair chance of having their offers featured in the site’s “buy box.” The firm had until May 3 to implement this directive.
Amazon was also prohibited from using marketplace data obtained from third-party sellers to gain an unfair competitive advantage and agreed to let sellers negotiate their delivery rates directly with independent providers.
In December 2022, Amazon had already made similar commitments in response to the EU investigation.
