Amazon to face antitrust charges from EU over treatment of third-party sellers

The European Union plans to file formal antitrust charges against Amazon.com Inc. over the e-commerce company’s treatment of third-party sellers, according to people familiar with the matter.

The charges could be officially filed as early as next week or the week after, one of the people said. The European Commission, the bloc’s top antitrust regulator, has been honing its case, and the case team has been circulating a draft of the charge sheet for a couple of months, another person said.

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The formal charges would be the commission’s latest step in a nearly two-year probe into Amazon’s alleged mistreatment of sellers that use its platform. The charges—called a statement of objections—stem from Amazon’s dual role as a marketplace operator and a seller of its own products, the people said. In them, the EU accuses Amazon of scooping up data from third-party sellers and using that information to compete against them, for instance by launching similar products.

Amazon declined to comment. It has previously disputed that it abuses its power and size and said that retailers commonly sell their own private-label brands.

AMAZON SCOOPED UP DATA FROM ITS OWN SELLERS TO LAUNCH COMPETING PRODUCTS

A Wall Street Journal investigation published in April found that employees at the online retailer at times used data from other sellers to develop competing products. According to former workers, the company sometimes asked an Amazon business analyst to create reports featuring restricted information or using supposedly aggregated data that was derived exclusively or almost entirely from one seller.

The EU’s case delves into the same types of conduct, the people familiar with the matter said.

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Following the Journal article, a top congressional committee questioned whether Amazon misled Congress in sworn testimony last year, when an executive denied using “individual seller data directly to compete” with other businesses on the platform. Amazon has launched an internal investigation, and said that employees using such data to inform private-label decisions would violate its policies.

For the past year, the House Judiciary Committee has been conducting an antitrust investigation into tech companies, including Amazon. Separately, the company is also the subject of antitrust probes by the Justice Department and the Federal Trade Commission.

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In Europe, a decision by the commission on whether Amazon broke competition laws is expected to take at least another year. If the company is found to have violated EU antitrust law, the commission can slap Amazon with a fine of as much as 10% of its annual revenue and force it to adjust certain business practices. Amazon can challenge any such decision in an EU court.

Margrethe Vestager, the European Commission’s vice president in charge of competition and digital policy, has in recent years fined Alphabet Inc.’s Google over $9 billion for anticompetitive behavior in three separate probes.

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Last year, Ms. Vestager launched other preliminary probes into Google and Facebook Inc., also examining their alleged anticompetitive conduct. Google and Facebook have said they are cooperating with the inquiries.

The U.S. platforms’ alleged anticompetitive behavior is also influencing Ms. Vestager’s thinking in regulatory proposals she plans to put forward by the end of the year, including powers for the commission to order changes in business practices before a dominant platform quashes its competitors, she has said.

“Our competition enforcement has taught us a lot about the sort of behavior by dominant platforms that can stop the markets which they regulate from working well,” Ms. Vestager said in a speech in March. “And we can draw on that experience to design regulations that clearly set out what those platforms can do with their power—and what they can’t.”

—Dana Mattioli contributed to this article.

Write to Valentina Pop at valentina.pop@wsj.com and Sam Schechner at sam.schechner@wsj.com