A group of UK retailers is suing Amazon for damages of up to £1.1 billion for illegally misusing their data and manipulating business practices to benefit its own commercial operations and outcomes.
The British Independent Retailers Association (Bira) has initiated legal action against Amazon that will be heard by the Competition Appeal Tribunal in London, the association said on Thursday.
This is the largest claim of its kind to ever be filed, with approximately 35,000 UK retailers currently involved with the matter.
Bira claims that since October 2015, Amazon has engaged in anti-competitive behaviour, using private data belonging to independent UK retailers on the company’s marketplace.
It’s alleged that the misuse of data was used in conjunction with manipulating the Amazon “buy box,” to engage in a product entry strategy that resulted in sales revenue and profits being diverted from these retailers to Amazon.
The retail advocacy group said Amazon misused confidential information from third-party sellers on Amazon’s UK marketplace, which helped them decide whether to enter a new product based on its earnings and sales potential, which elements of the product to copy, how to price an item, and which consumers to target.
Bira, which represents over 6,000 independent businesses across the UK, claims that Amazon’s activities have unfairly disadvantaged smaller retailers, many of which were unaware that Amazon was using their data to benefit its own retail operation. They believe Amazon’s tactics are pushing many of the UK’s independent retailers out of the market, which already pay the company 30 percent in commission on all sales.
Andrew Goodacre, CEO of Bira, said in a statement on Thursday: “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 business 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. Whilst the retailers knew about the large commissions charged by Amazon, they did not know about the added risk of their trading data being used by Amazon to take sales away from them.”
Mr. Goodacre added, “The British public has a strong relationship with its local, independent retailers and ensuring they are not put out of business by Amazon’s illegal actions is a key driving force behind this collective action.”
Amazon ‘Confident That It Is Baseless’
Amazon has long disputed the suggestion that it misuses the information it collects from third-party retailers, and that it uses the “buy box” to preference its own retail operations.The online giant also agreed to numerous commitments after the Competition and Markets Authority opened a probe into its practices in 2022.
An Amazon spokesperson told The Epoch Times by email on Friday that they were yet to see the complaint. However, they noted that “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,” the spokesperson said.
The claim is to be filed under the Competition Act 1998. The act was amended in 2015 to enable a collective damage claim to be brought on behalf of a class of people who have suffered loss.
Bira has instructed the international law firm Willkie Farr & Gallagher LLP to act on its behalf.
“This is precisely the sort of claim that the new collective action regime was brought in for,” said antitrust and competition solicitor at Willkie Farr & Gallagher, Boris Bronfentrinker, in Thursday’s press release.
“The power of Amazon is unrivalled when it comes to the very important online world to which so much commerce has migrated. Making itself a must use for retailers, Amazon has then proceeded to cause damage and financial loss to retailers by misusing their confidential data that Amazon was entrusted to keep safe and by preferencing its own retail operations,” said Mr. Bronfentrinker.
“No individual retailer, no matter how large, is willing to get into the lion’s den and take the fight to Amazon, but fortunately Bira has shown that it will stand up and fight for UK retailers,” he said.
If the Competition Appeal Tribunal agrees to proceed with the class action, the trial will not take place until the middle of 2026, unless Amazon agrees to settle the matter out of court.
In the rules outlined under the Competition Act 1998, all UK retailers that suffered a loss and are now domiciled in the UK will automatically become part of the claimant class unless they explicitly opt out.
This means once the claim is filed, no action will be required by individual retailers as they will automatically be eligible for compensation at the conclusion of the tribunal. Those not currently domiciled in the UK, but who sold on the UK Amazon marketplace, will have the opportunity to opt in and get the benefits of the proposed claim.
