Amazon and brands jointly suppress sellers? The two giants face 500 million pounds in compensation

Amazon and Apple are facing a class-action lawsuit in the UK alleging they conspired to raise prices for Apple and Beats (owned by Apple) products on Amazon’s marketplace .

The lawsuit, filed in the UK Competition Appeal Tribunal, is for all UK consumers who have purchased Apple or Beats products on Amazon's marketplace since October 2018 , and seeks at least 500 million pounds (about $645 million) in damages from the two companies.

The lawsuit alleges that Amazon and Apple reached a secret agreement in 2018 that allowed the two parties to conspire to illegally raise prices for Apple products sold on Amazon's e-commerce marketplace.

The lawsuit alleges that the deal allowed Amazon to restrict independent sellers from selling Apple's popular products on the platform in exchange for preferential wholesale prices on Apple and Beats kits, thereby raising the prices for British consumers to buy Apple and Beats products on Amazon.

The lawsuit also states that due to collusion between Apple and Amazon, by January 2019, almost all independent merchants selling Apple and Beats products disappeared from the Amazon marketplace ; this resulted in the few remaining independent sellers offering fewer discounts to customers and a significant increase in sales of undiscounted Apple and Beats products.

In response to this accusation, an Amazon spokesperson said that this statement is totally unfounded . He believes that the truth of the matter will become clear during the trial of the case; and the agreement between Amazon and Apple allows customers to find the latest Apple and Beats products in Amazon's store , and also allows customers to benefit from more favorable transactions and faster delivery.

Apple declined to make a public statement, saying it had not received any information related to the lawsuit. However, it provided some information to the media to explain its dealer agreement with Amazon. Apple said that the main purpose of signing the agreement was to combat counterfeit and inferior products and safety issues in the online market to ensure a high-quality product experience for customers.

Apple also said that before the 2018 agreement was signed, the problem of counterfeit goods on Amazon was particularly serious, so they had to invest a lot of time and resources to combat these counterfeits, including sending hundreds of thousands of product drop notifications to Amazon. This phenomenon continued until the agreement was signed, when Apple counterfeits on the Amazon market were significantly reduced.

In fact, before this lawsuit in the UK, the two technology giants had been subject to antitrust enforcement in Italy and Spain and were sentenced to fines of nearly US$440 million.

Competition regulators in both countries found that Apple colluded with Amazon to impose illegal restrictions on local resellers of Apple accessories on Amazon's platform, but Amazon and Apple disputed the findings and appealed.

The companies were granted leave to appeal in Italy in June last year . The British litigants said they had no comment but were using information and economic analysis contained in the Italian regulator’s judgment to support their claims.

The two companies are also facing similar class-action lawsuits in the U.S., which also accuse them of conspiring to fix product prices. Just last month, a federal judge in the U.S. rejected the companies' motion to dismiss the consumer antitrust lawsuit and ruled that the lawsuit can proceed.

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