Italy fines Amazon and Apple $230M over alleged reseller collusion

Italy fines Amazon and Apple $230M over alleged reseller collusion

Following an investigation into the resale of Apple and (Apple-owned) Beats gear on Amazon’s Italian e-commerce platform, Italy’s antitrust regulator fined Amazon and Apple about $230 million (€203 million) in total fines. The suspected cooperation, according to the authorities, reduced the amount of discounts offered to customers buying Apple and Beats items on the Amazon Italy marketplace.

It has also ordered the tech behemoths to lift reseller limitations. The AGCM issued the fine Monday, citing a restricted arrangement between the two that prevented certain “legal” Beats resellers from selling their items on Amazon. The fine split between Amazon and Apple, with Amazon receiving €134.5 million ($151 million) and Apple receiving €68.7 million ($77.3 million).

The contract in question signed in October 2018 between the two parties. The AGCM discovered a number of contractual restrictions in the agreement that banned official and unauthorized retailers of Apple and Beats items from utilizing Amazon, according to the press release.

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Italy fines Amazon and Apple $230M over alleged reseller collusion

It — with the ban preventing Apple and Beats items from sold on Amazon. It was given to Amazon and a number of resellers who were “selected individually and in a discriminatory manner,” according to the authority, in breach of Article 101 of the Treaty on the Functioning of the European Union.

“The inquiry revealed the aim to impose a purely quantitative restriction on the number of merchants, enabling only Amazon and specific subjects, defined in a discriminatory manner, to operate on Amazon. it,” the announcement says [which we translated from Italian using Google Translate]. “The agreement’s conditions also limited cross-border sales, since shops were discriminated against based on their location. The agreement’s limits have had an impact on the amount of discounts given by third parties on Amazon. it, reducing their magnitude.”

According to the authorities, Amazon’s local marketplace accounts for at least 70% of consumer electronic kit purchases in the nation, with “at least 40% represented by shops that utilize Amazon as a brokerage platform.” “It thus appears essential that the application of competition rules ensure a level playing field for all retailers who use marketplaces as an increasingly important place for carrying out their commercial activity, especially in today’s context,” it continues, “avoiding the implementation of discriminatory behaviors that restrict competition.”

“In this regard, the Authority’s judgment acknowledges, in accordance with EU Court of Justice law, the necessity for distribution systems to be based on qualitative criteria, not discriminatory, and applied equally to all prospective resellers in order to be compliant with competition regulations.” The Italian authority also mentions that, because of its probe into the Amazon-Apple deal, national competition regulators in Germany and Spain have launched similar investigations.

This summer, Spain’s Comisión National de Los Mercados y la Competencia said that Amazon and Apple might face disciplinary action, as well as launching its own inquiry (which it said would take up to 18 months to complete). While Germany’s Bundeskartellamt opened an abuse investigation into Amazon in 2018 after receiving complaints from sellers on its marketplace, the investigation closed the following year after Amazon amended its general terms of business for sellers and promised additional changes to address competition concerns.