110427_comision-europea-2009Amazon’s E-books European Union Antitrust Investigation

The European Commission just opened a formal antitrust investigation to Amazon for their distribution of e-books. As investigated before with Apple and five international publishing houses (Penguin Random House, Hachette Livres, Simon & Schuster, HarperCollins and Georg von Holtzbrinck Verlagsgruppe), the current investigation will address the contracts between the publishers and amazon.

As stated by the EU Commision, there are concerns that “certain clauses included in Amazon’s contracts with publishers concerning such e-books could constitute a breach of EU antitrust rules that prohibit the abuse of a dominant market position and restrictive business practices.” The investigation will focus in the clauses that seem to shield Amazon from competition, that is to say, from other e-book distributors that could compete with Amazon by developing new products and services.

As stated by The Guardian, the inquiry will focus on English and German ebooks, which are the largest markets across Europe. The legal matter will be the clauses granting Amazon the right to be informed of more favourable or alternative terms offered to its competitors; and/or the right to terms and conditions at least as good as those offered to its competitors. If proved, the behaviour of Amazon would violate EU antitrust rules that prohibit abuses of a dominant market position and restrictive business practices.

Application of Articles 101 and 102 TFEU (formerly Articles 81 and 82 of the EC Treaty) does not prohibit the existence of a dominant position but simply prohibit the abuse. As stated by Professor Frignani, the rule, which welcomes the dichotomy between cartels and abuse, first introduced in Europe in the GWB, endorsed by the EC Treaty and from there spread today in all national legislations of the member countries, is inspired by the need to take action against restrictive competition behaviour held by companies. 

Is important to consider that the rule does not have the function of preventing a dominant position or a monopoly, but to prevent these positions in making a distortion of competition in the market. As named recently in the NYT, similar investigation was previously brought last April by the EU against Google, in order to establish if their search engine “artificially skew results to favor its own shopping service to the detriment of rivals.”

The investigation of this big american tech companies comes during the Transatlantic Trade and Investment Partnership (TTIP) negotiations and the development of the EU Digital Single Market policy.

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