Prime target: Contours of possible FTC case against Amazon become clearer

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Prime target: Contours of possible FTC case against Amazon become clearer
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FTC Chairwoman Lina Khan is a longtime critic of the online retail giant.

A reported “last rites” meeting for Amazon with the three members of the Federal Trade Commission last week signals that a case against the online retail giant may be imminent.

One issue for regulators would be"price parity." That is, up until 2019, Amazon prevented third-party sellers in its online marketplace from offering lower prices in other selling venues. That year the company changed its policy to ban sellers from “setting a price on a product or service that is significantly higher than recent prices offered on or off Amazon.

Perhaps also at issue is the platform’s"self-preferencing" practices. Critics charge that Amazon unfairly advantages itself when it competes with third-party sellers in offering similar items. Specifically, the accusation is that Amazon favors the search results with offers from its in-house brand, Amazon Basics, over those of third-party sellers. This practice would have been banned by the American Innovation and Online Choice Act, which failed to pass in Congress last session.

Most recently, the FTC’s Consumer Protection Bureau filed charges against Amazon for using “manipulative, coercive, or deceptive user-interface designs known as ‘dark patterns’ to trick consumers into enrolling in automatically renewing Prime subscriptions.” The company’s sheer size and market power, with wildly successful services like Prime, may factor into the upcoming case.

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