Amazon could be forced to pay £900m for 'favouring own products'

A collective claim alleges Amazon has breached competition law and directed customers to offers benefiting it directly.

Amazon could be forced to pay £900m to shoppers in compensation for ‘favouring own products’ stockcam via iStock

Amazon shoppers in the UK could receive a share of £900m in compensation, according to a proposed legal claim.

Filed by Hausfeld and Co. LLP, the collective claim alleges the company has breached competition law and directed customers to offers that benefit Amazon directly.

Dubbed the UK Buy Box Claim, it refers to the the “Add to Basket” and “Buy now” buttons which appear in what is known as the “Buy Box” at the top right-hand corner of the product page on and at the bottom of the screen on the Amazon app.

Hausfeld says that 80% of all of the company’s sales are made using the Buy Box.

Led by consumer rights advocate Julie Hunter, the claim is seeking to represent the interests of millions of Amazon users in the action, expected to be filed in the Competition Appeal Tribunal soon.

It will accuse the company of breaching section 18 of the UK Competition Act 1998 and Article 102 of the Treaty on the Functioning of the European Union.  

“Online shoppers have a right to be treated fairly and to be able to make informed decisions,” Ms Hunter said.

“This lack of transparency and manipulation of choice is an abuse of consumers’ trust, as well as a raid on their wallets. 

“Amazon occupies an incredibly powerful position in the market, making it impossible for consumers to take individual action.

“Amazon shouldn’t be allowed to set the rules in its favour and treat consumers unfairly. That is why I am bringing this action.”

According to the claim, Amazon’s Buy Box uses an algorithm which is biased to favour goods sold by the firm as part of its retail business or by third-party sellers who use its order fulfilment and delivery services.

This effectively prevents millions of consumers from navigating the site to find cheaper offers or better delivery options for the same product.

The claim says that such manipulation of consumers is a breach of Amazon’s obligation not to distort competition as the dominant marketplace, and will will seek damages from Amazon in the region of £900m.

Lesley Hannah, one of the Hausfeld partners leading the litigation, said: “Competition laws are there to protect everyone.

“They ensure that individuals can make genuine and informed choices, and are not simply led into making selections which benefit the companies they interact with.

“Fairness is at the heart of competition law and consumers are not being treated fairly by Amazon.”

An Amazon spokesperson said: “This claim is without merit and we’re confident that will become clear through the legal process.

“Amazon has always focused on supporting the 85,000 businesses that sell their products on our UK store, and more than half of all physical product sales on our UK store are from independent selling partners.

“We always work to feature offers that provide customers with low prices and fast delivery.”

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