June 18, 2015

Top EU antitrust official: “We fear that [Amazon] has grown so big that they think they can… close competition”


Margrethe Vestager (via Wikipedia)

Margrethe Vestager (via Wikipedia)

A week ago, the European Commission, the EU‘s governing body, made a major announcement: it was launching an antitrust investigation into Amazon’s ebook contracts with publishers. At the time, details were fairly scarce—we knew that the investigation was about ebooks and ebooks only and that it would revolve around MFN clauses, but not much else.

Earlier this week, we learned a little more about the investigation. In a speech delivered in Paris on Monday, Margrethe Vestager, the “European Union’s top antitrust official… was both admiring and wary” of Amazon while referencing the fledgling investigation, according to Bloomberg. In the speech, Vestager said “We fear that they have grown so big that they think they can use their strength to close competition, to close the road to innovation” and “”Amazon should not use its strong position to close the door behind it and prevent companies with new ideas from contesting the market.”

Neither statement is significantly different from the Vestager’s earlier statement—“It is my duty to make sure that Amazon’s arrangements with publishers are not harmful to consumers, by preventing other e-book distributors from innovating and competing effectively with Amazon”—except in attitude. This was a more forceful statement, one that Reuters interpreted as a “warning.” Vestager’s speech also hit back at mergers between European telecommunications giants.

Amazon’s tax relationship with Luxembourg is also under investigation by the EU.

Alex Shephard is the director of digital media for Melville House, and a former bookseller.