Apple and Amazon are facing yet another lawsuit in Europe over accusations of anti-competitive market collusion practices. Both companies are the target of a new class-action suit in the United Kingdom seeking £500 million ($645 million) in damages, according to TechCrunch.
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The lawsuit claims that Apple and Amazon signed a secret agreement back in 2018 that artificially and illegally increased the prices of Apple products – including Beats – on Amazon’s platforms in the UK. The suit – which has been filed with the UK’s Competition Appeals Tribunal – seeks a payout of £500 million for millions of UK consumers who bought Apple products through Amazon since October 2018, adds the report.
The plaintiffs proclaim that the 2018 agreement involving both companies greatly confined the ability of third-party resellers on Amazon to sell Apple products. In return, Apple provided Amazon with good discounts on wholesale prices for the former’s products. This resulted in less competition through which Amazon could get away with charging higher prices on its marketplaces for those who wanted to buy Apple products in the UK. This apparent collusion meant that there were almost no third-party merchants on Amazon that sell Apple products by January 2019.
The lawsuit is brought forward by Christine Riefa, a Professor of consumer law at the University of Reading. Riefa is being supported by Hausfeld & Co law firm and litigation funder Asertis. The claim is pursued on an opt-out basis, automatically encompassing all UK class members for potential compensation if the litigation succeeds, unless they choose to opt out. Participants are not required to bear any costs or fees, ensuring that affected consumers can engage in legal action without facing any financial burden. Prospective claimants can find more info on the lawsuit’s dedicated website.
Millions of consumers in the UK enjoy the services and products of Apple and Amazon. They do not suspect that those companies collude to make them pay more for their electronics and reduce their choice. I believe that big businesses like Apple and Amazon should behave fairly and compete on merits, not by using underhand tactics.
Each company has an effective stranglehold over its market, and they are misusing that advantage to shut out competition from independent merchants — unlawfully lining their wallets at the expense of consumers. It’s a betrayal of their customers’ loyalty.
Professor Christine Riefa
TechCrunch contacted Apple and Amazon for a statement, where an Amazon spokesperson provided the following:
This claim is without merit, and we’re confident that this will become clear throughout the process. As a result of our agreement with Apple, customers can find the latest Apple and Beats products on our store, and they benefit from an expanded range with better deals and faster shipping.
Apple’s troubles in Europe
The lawsuit is almost exactly similar to another one which took place in Spain, where the Spanish anti-competition watchdog fined Apple and Amazon over $218 million. Like the accusations brought forward today, Apple and Amazon were found guilty of market collusion by greatly restricting independent Apple products merchants on Amazon’s platforms, in addition to limiting ads for competitors when users searched for Apple products on Amazon.
This would also be the second class-action lawsuit filed against Apple this week in the UK. Yesterday, it was revealed that the company was being sued by over 1,500 third-party app developers for $1 billion as damages over unfair App Store commission fees, which range from 15% to 30% depending on the annual revenue generated by each developer.