Canadian federal agency launches probe into practices adopted by Amazon

The investigation was announced by the Gatineau, Quebec-based Bureau in a statement as it requested “market participants to provide input to inform” the probe into “conduct by Amazon.”
Amazon, has been among the prime destination for digital purchases during the boom, which has persisted through the period of restrictions caused by the Covid-19 pandemic.(Reuters file photo)
Amazon, has been among the prime destination for digital purchases during the boom, which has persisted through the period of restrictions caused by the Covid-19 pandemic.(Reuters file photo)
Published on Aug 15, 2020 08:20 AM IST
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Hindustan Times, Toronto | ByAnirudh Bhattacharyya| Edited by: Harshit Sabarwal

Canada’s federal Competition Bureau has launched a civil investigation into the practices adopted by global retail giant Amazon.

The investigation was announced by the Gatineau, Quebec-based Bureau in a statement as it requested “market participants to provide input to inform” the probe into “conduct by Amazon.”

The Bureau also noted that the probe was “ongoing” and there was “no conclusion of wrongdoing at this time.”

The Bureau stated that it was looking into whether Amazon was “engaging in conduct” on its Canadian marketplace Amazon.ca, “that is impacting competition to the detriment of consumers and companies that do business in Canada.”

The investigation is being conducted under restrictive trade provisions of the country’s Competition Act, with a focus on potential “abuse of dominance.” That is defined as occurring “when a dominant firm in a market, or a dominant group of firms, engages in conduct that is intended to eliminate or discipline a competitor or to deter future entry by new competitors, with the result that competition is prevented or lessened substantially.”

Among the areas being considered under investigation by the Bureau are “past and existing” practises by Amazon that “may impact third-party sellers’ willingness to offer their products for sale at a lower price on other retail channels, such as their own websites or other online marketplaces.”

It is also examining whether third-party sellers can succeed on Amazon Marketplace without using the ‘Fulfilment by Amazon’ service or advertising on the website. Another aspect under the scanner is “any efforts or strategies by Amazon that may influence consumers to purchase products it offers for sale over those offered by competing sellers.”

The Bureau pointed out that online shopping had increased over threefold in Canada between 2012 and 2018, from CA$ 18.9 billion to CA$ 57.4 billion. Amazon, obviously, has been among the prime destination for digital purchases during the boom, which has persisted through the period of restrictions caused by the Covid-19 pandemic.

The Bureau is a Federal institution that serves “as an independent law enforcement agency” and “ensures that Canadian businesses and consumers prosper in a competitive and innovative marketplace.”

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