The FTC and 17 state attorneys filed a long-awaited antitrust complaint against Amazon on September 26. The lawsuit is the result of a four-year investigation and was expected after years of complaints that Amazon and other Big Tech companies have been abusing their market power.
“The FTC and its state partners say Amazon’s actions allow it to stop rivals and sellers from lowering prices, degrade quality for shoppers, overcharge sellers, stifle innovation, and prevent rivals from fairly competing against Amazon,” the commission said in a statement.
The FTC said it is asking the court to issue a permanent injunction prohibiting Amazon from engaging in its unlawful conduct . The lawsuit was filed in Seatlle federal court, which is also the location of Amazon’s headquarters. Meanwhile, the company’s shares fell by four percent.
The FTC alleges that Amazon, which was founded in 1994 and is now worth $1.3 trillion, has been fighting efforts by competitors who tried to offer prices below theirs by making it harder for consumers to find these sellers on its online marketplace. In addition, it is accused of giving preference to its own products on the Amazon platform.
Amazon responded that the FTC’s complaint “grossly mischaracterizes the retail industry and the dynamic competition that consumers benefit from every day” and will hurt consumers by causing higher prices and slower deliveries.
The need to act against the tech giants is one of the few ideas on which both Democrats and Republicans agree. During the Trump administration alone, the Department of Justice and the FTC opened probes into Google, Facebook, Apple and Amazon, and Google was also sued for monopoly earlier this year.