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Germany Eyeballs Amazon for Abuse

FILE: Image of Amazon "Prime" logo, taken 10.1.2020

Germany's anti-cartel watchdog said Wednesday it has placed e-commerce giant Amazon under closer surveillance for any possible abuse of its market position.

The Federal Cartel Office said it had determined Amazon to be a company of "paramount significance for competition", a move that will allow it to act more effectively to "intervene and prohibit potential anticompetitive practices."

Amazon was a "key player in the e-commerce sector" and had created a "digital ecosystem" as both seller and marketplace, said Federal Cartel Office chief, Andreas Mundt.

The watchdog estimated that "over every second euro spent" in online retail in Germany was via Amazon's local website.

As a platform for sellers, Amazon holds "over 70 percent" of the market, giving it a "dominant" position, according to the Federal Cartel Office.

The regulator is currently conducting two other investigations into Amazon's practices under its normal procedure.

In one case, it is examining whether Amazon uses "price control mechanisms and algorithms" to influence seller pricing on its marketplace.

In the other, it is looking at the extent to which agreements with big-brand manufacturers that "exclude third-party sellers from selling brand products" constitute a competition law violation.

Amazon joins Google parent Alphabet and Meta, the group behind Facebook, in falling under reinforced monitoring made possible by the German Competition Act.

The act, which came into force in January 2021, allows the cartel authority to intervene earlier, particularly against the world's tech giants.