Unpacking the Murky E-Commerce Truth

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As human beings, we might be the smartest species in world’s history, but we are also pretty limited in what we are able to see. This renders us unable in regards to spotting many detrimental possibilities, and as you can guess, such a dynamic brings all the risk to the table. Hence, to deal with it, the world would setup dedicated regulatory bodies throughout the spectrum. The move did straighten out many wrinkles at once, but when technology took over the landscape, it ended up changing the picture yet again. You see, technology’s layered nature gave rule breakers every chance of hiding their misdoings, therefore completely nullifying the regulators’ authority. However, fortunately enough, it seems like the regulators have made a lot of ground in the recent past. This is backed up well by the increased scrutiny on Big Tech companies. In fact, an iteration of the same was on full display after Washington DC Attorney General filed a motion in regards to a case against Amazon.

DC Attorney General Karl Racine has officially filed a motion asking the court to reconsider its dismissal of the antitrust lawsuit against Amazon. This follows up on Racine’s original accusations, which talked about how Amazon was “illegally abusing and maintaining its monopoly power by controlling prices across the online retail market.” The price control that Racine is referring to here is a part of the company’s fair pricing policy. According to the policy, third-party sellers cannot sell their goods for lower prices through another channel, and if they do it, Amazon will have the right to remove their items’ buy box, suspend their shipment option, and in certain cases, terminate their selling privileges altogether. Racine’s rational here is that, as Amazon is owed a commission cut on every sale, it automatically forces the seller to charge a little more than they would otherwise. So, if, alongside that, the sellers are also prohibited from setting lower prices across other channels, it ends up creating a reality where the final consumer has to bear the cost of Amazon’s monopoly.

“We’re asking the court to reconsider its decision to dismiss our Amazon case because the antitrust laws and facts are on our side and we are determined to continue standing up for DC consumers. Amazon illegally uses its market power to prevent sellers from lowering their prices on other platforms — including their own. This results in higher prices for DC consumers,” said Racine.

While Amazon is yet to comment on the latest development, the company did offer a response when the lawsuit was first filed in 2021.

“Amazon takes pride in the fact that we offer low prices across the broadest selection, and like any store we reserve the right not to highlight offers to customers that are not priced competitively,” said an Amazon spokesperson.

 

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