Amazon is facing a $1bn lawsuit over claims that the company favoured its own products on its website.
It is accused of using “a secretive and self-favouring algorithm” to promote its own brands through the “Buy Box” on its website, according to consumer rights advocate Julie Hunter.
Items in the “Buy Box” are more visible to shoppers and are therefore more likely to be purchased, which the lawsuit alleges means Amazon broke competition law.
“Far from being a recommendation based on price or quality, the buy box favours products sold by Amazon itself or by retailers who pay Amazon for handling their logistics,” Ms Hunter said in a statement. “Other sellers, however good their offers might be, are effectively shut out.”
In response, Amazon said: “This claim is without merit and we’re confident that will become clear through the legal process. We always work to feature offers that provide customers with low prices and fast delivery.”
This is not the first time that Amazon’s “Buy Box” has been investigated; in June, the UK’s Competitions and Markets Authority (CMA) also raised concerns that Amazon’s marketplace favours its own products.
“Millions of people across the UK rely on Amazon’s services for fast delivery of all types of products at the click of a button,” said Sarah Cardell, general counsel at the CMA.
“This is an important area so it’s right that we carefully investigate whether Amazon is using third-party data to give an unfair boost to its own retail business and whether it favours sellers who use its logistics and delivery services – both of which could weaken competition.”
In India, leaked documents suggested that Amazon systematically created knockoff brands and manipulated search results to boost its own product lines, according to a report.
In a statement, Amazon claimed that it “believe[d] these claims are factually incorrect and unsubstantiated” but did not address questions from the report.
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