Amazon and Meta have agreed to make changes to their marketplaces for UK users to ensure fairer conditions for third-party retailers. Competition watchdog the Competition and Markets Authority (CMA) said the tech giants have made concessions after two separate investigations into their behaviour.
By reaching voluntary agreements, the two companies have avoided formal antitrust investigations that could’ve landed them heavy fines under the UK’s new Digital Markets Act legislation.
Amazon and Meta agree to UK changes
The CMA says it has secured commitments from Amazon that will help ensure that third-party marketplace sellers can compete on a level playing field.
Agreed changes relate to the so-called ‘buy box’, which promotes items for sale on Amazon. Most sales on the platform come through the buy box, and the company has been accused of using its position, as both the marketplace platform provider and a participant in the marketplace, to promote its own products in this section at the expense of those of other companies.
Amazon will now give independent sellers a “fair chance” of their offers featuring in the buy box, according to a CMA statement. It will also be prevented from using marketplace data it obtains from third-party sellers to give its own products an unfair advantage and will allow sellers to negotiate their own delivery rates directly with independent providers.
Meanwhile, Meta, Facebook’s parent company, has agreed conditions that will prevent it from deploying its advertising customers’ data to improve the Facebook Marketplace platform. Advertisers will be able to opt out of having their data used in this way.
Ann Pope, senior director for antitrust enforcement at the CMA, said: “We have accepted Amazon’s commitments as they help thousands of independent UK sellers to compete on a level playing field against Amazon’s own retail arm. This should also mean customers get access to the best product offers.
“The commitments secured from Meta mean the firm cannot exploit advertising customers’ data to give itself an unfair advantage – and as such distort competition.”
Independent trustee will hold Amazon to account
The commitments from both companies are voluntary, but the CMA says it will appoint an “independent trustee” to ensure compliance.
Gareth Mills, partner at law firm Charles Russell Speechlys, said this announcement is an “interesting” development. He explained: “This trustee will oversee the implementation of new technical systems and employee training to ensure that such commitments are delivered upon.”
Mills added: “The CMA’s decision shows that the competition regulator’s supervision of the Big Tech companies and their use of customer data to gain even a perceived competitive advantage, remains a pressing issue.
“From a legal point of view, it is clear that the CMA remains active and watchful in monitoring Big Tech’s use of data to support their own business models and are willing to apply a robust enforcement framework where this conflicts with well-established competition law norms.”
A spokesperson for Amazon said: “We have engaged constructively with the CMA and we welcome this resolution which will preserve our ability to serve both our customers and the over 100,000 small and medium-sized businesses selling through our UK store.
“We are extremely proud of the work our teams have done to support our sellers’ success over the past two decades.”
Tech Monitor has also contacted Meta for comment.