Independent UK retailers have launched the biggest ever retail class action with a £1bn claim for damages against Amazon, which they allege has been pushing them out of its online marketplace.
The claim, brought by about 35,000 sellers and headed by the British Independent Retailers Association (Bira), asserts that between October 2015 and the present day, Amazon used non-public data belonging to the retailers to inform the launch of its own rival products.
It also alleges that Amazon manipulated access to its “buy box”, where most sales on the platform take place, to divert shoppers away from independent retailers to its own items.
Bira said Amazon was already charging its members a “non-negotiable 30% commission on every product sold on the site” and claims that, by “misusing their proprietary data to bring to market rival products that are sold cheaper, Amazon is effectively pushing many of the UK’s independent retailers out of the market”.
“The consequences of Amazon’s abusive conduct have been to inflate its profits and harm the UK retail sector, especially the smaller independent retailers who are struggling at a time of difficult economic circumstances,” the trade body said.
Bira said it would file more than 1,150 pages of documents with the competition appeal tribunal (Cat) in London that set out the claim against Amazon.
Andrew Goodacre, the chief executive of Bira, said: “One might ask, why would an independent retailer use Amazon if it is so damaging to their business? In reality, we have seen a significant shift in consumer buying behaviour and, if small businesses want to sell online, Amazon is the dominant marketplace in the UK.
“As a result, for small retailers with limited resources, Amazon is the marketplace to start online trading.”
A spokesperson for Amazon said: “We have not seen this complaint, but based on the reporting so far we are confident that it is baseless and that this will be exposed in the legal process. Over 100,000 small and medium-sized businesses in the UK sell on Amazon’s store, more than half of all physical product sales on our UK store are from independent selling partners, and the fact is that we only succeed when the businesses we work with succeed.”
In 2022, the UK’s Competition and Markets Authority (CMA) launched an investigation into whether Amazon had been giving its own brands and those using its logistics services unfair advantage over third-party rivals on its marketplace.
The UK investigation, and a similar investigation by the EU Commission, came after a string of reports alleging that Amazon used third-party sellers’ data to copy products.
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In November last year, the investigation closed after the firm agreed to give independent sellers a fair chance of their offers being featured in the site’s “buy box”. It had until 3 May to implement that directive.
Amazon was also prevented from using marketplace data it obtains from third-party sellers to give itself an unfair competitive advantage and agreed to allow sellers to negotiate their delivery rates directly with independent providers.
Amazon had already made similar commitments in December 2022 in response to the EU investigation.