German competition authorities are scrutinizing Amazon’s (NASDAQ:AMZN) pricing tools, citing concerns that the mechanisms could breach competition laws. The Federal Cartel Office raised issues with how Amazon’s marketplace algorithms highlight competitively priced products while potentially downranking or removing listings deemed too expensive.
Amazon operates a vast marketplace featuring products from both third-party sellers and the company itself. Its algorithm promotes offers based on factors such as price, delivery speed, and availability – features designed to improve customer experience and boost sales of competitively priced items.
However, the German watchdog argued that these tools may impose “inappropriate and objectively unjustified restrictions” on third-party sellers by influencing which offers gain visibility. The regulator also expressed concern that Amazon could alter internal pricing thresholds at its discretion, potentially distorting competition by limiting seller autonomy.
In a statement, Amazon defended its approach, asserting that sellers retain full control over their pricing, shipping fees, and return policies. The company maintained that its pricing tools are intended to help customers find the best deals quickly and efficiently.
An Amazon spokesperson pushed back against the regulator’s claims, saying, “If we were prevented from guiding customers to competitively priced offers, we’d be forced to display uncompetitive or abusive pricing, which would result in a worse shopping experience.”
The Federal Cartel Office’s concerns signal heightened regulatory focus on how dominant e-commerce platforms manage third-party listings – particularly in ways that could suppress competition or restrict fair pricing practices. The investigation remains ongoing, with potential implications for Amazon’s broader European operations.