Online retail giant Amazon has reached an agreement with the European Commission to close two inquiries into anticompetitive tactics, notably using third party seller data to improve its own sales.
The agreement allows Amazon to avoid a legal battle with the EU’s top antitrust watchdog that could have ended with huge fines, worth up to 10 per cent of its annual worldwide revenue.
“Today's decision sets the rules that Amazon will need to play by in the future instead of Amazon determining these rules for all players on its platform,” said EU Vice President Margrethe Vestager, as she made the announcement at a press conference in Brussels.
“With these new rules, competing independent retailers, carriers, and European customers will have more opportunity and more choice,” she added.
Amazon has until June 2024 to implement the new rules, which include refraining from using non-public seller data for the benefit of its own retail operations.
The EU considers that Amazon unfairly benefits from its dual role as both a platform where independent sellers can sell their products and as a retailer which is in competition with these independent sellers.
By using data from independent sellers to make its own business decisions, Amazon takes less business risk than these competing sellers which do not have access to such data, according to the EU.
“Our preliminary conclusion was that the use of data was an abuse of Amazon’s dominant position on a marketplace,” said Ms Vestager.
Amazon will also have to apply non-discriminatory conditions and criteria for sellers to access its so-called Buy Box, which offers the option to buy easily and fast, and display a second Buy Box, which will appear when there is a second offer that is different from the first one on price or delivery.
The EU considers that the Buy Box favoured Amazon retail operations. The aim of the second Buy Box is to give more visibility to independent sellers. The Commission will be able to monitor the performance of this second box and request adjustments if consumers are not sufficiently active on it.
Finally, Amazon must stop favouring its own retail and logistics operations when it comes to its Prime service, which is rapidly growing in Europe and also represents the highest spending and most loyal group on the marketplace, according to Ms Vestager.
Prime sellers will be free to choose any carrier for their logistics and carrier services, which is currently not possible. Amazon will not be able to prevent carriers from directly contacting customers to track their parcels.
“We are pleased that we have addressed the European Commission’s concerns and resolved these matters,” Amazon said in a prepared statement.
Amazon’s compliance with the new rules will be ensured by both a complaint mechanism and a monitoring trustee, said Ms Vestager.
These commitments end two investigations into Amazon’s business practices launched by the EU in recent years.
They are in part based on feedback received by the Commission between July and September 2022 from sellers, including publishers, seller associations, carriers, consumer associations, and academics.
The Commission first opened an investigation into Amazon’s use of non-public data of its marketplace sellers in July 2019. It opened a second investigation into Amazon’s buy box in November 2020.
The settlement is the latest round in a long-running Europe-wide crackdown on the market power of tech firms such as Google, Apple and Meta Platforms that has led to multiple probes, fines and beefed-up laws.
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
MATCH INFO
Europa League semi-final, second leg
Atletico Madrid (1) v Arsenal (1)
Where: Wanda Metropolitano
When: Thursday, kick-off 10.45pm
Live: On BeIN Sports HD
Tips for taking the metro
- set out well ahead of time
- make sure you have at least Dh15 on you Nol card, as there could be big queues for top-up machines
- enter the right cabin. The train may be too busy to move between carriages once you're on
- don't carry too much luggage and tuck it under a seat to make room for fellow passengers
England World Cup squad
Eoin Morgan (capt), Moeen Ali, Jofra Archer, Jonny Bairstow, Jos Buttler (wkt), Tom Curran, Liam Dawson, Liam Plunkett, Adil Rashid, Joe Root, Jason Roy, Ben Stokes, James Vince, Chris Woakes, Mark Wood
'Panga'
Directed by Ashwiny Iyer Tiwari
Starring Kangana Ranaut, Richa Chadha, Jassie Gill, Yagya Bhasin, Neena Gupta
Rating: 3.5/5
MATCH INFO
Champions League quarter-final, first leg
Tottenham Hotspur v Manchester City, Tuesday, 11pm (UAE)
Matches can be watched on BeIN Sports
