The OFT has welcomed Amazon’s decision to end its price parity policy, which restricts its sellers from offering lower prices on other online sales channels, across its Marketplace in the EU from today.
Following numerous complaints, the OFT opened a formal investigation into Amazon’s price parity policy in October 2012. It was concerned that the policy was potentially anti-competitive. In particular, it found that such policies may raise online platform fees, curtail the entry of potential entrants, and directly affect the prices which sellers set on platforms – including their own websites – resulting in higher prices to consumers. In light of Amazon’s decision, the OFT is currently minded to close its investigation on grounds of administrative priority.
The OFT has not reached a decision as to whether there has been an infringement of competition law. It says it continues to monitor the online retail sector, and may use its power to investigate such price parity policies at any time. Throughout its investigation, the OFT has co-operated closely with the German Federal Cartel Office, which has been running a parallel investigation into Amazon’s policy, and has recently made a related announcement.
Cavendish Elithorn, OFT senior director of goods and consumer, says: "We welcome Amazon’s decision to end its Marketplace price parity policy across the EU. As Amazon operates one of the UK’s biggest e-commerce sites, the pricing on its website can have a wide impact on online prices offered to consumers elsewhere. We are pleased that sellers are now completely free to set their prices as they wish, as this encourages price competition and ensures consumers can get the best possible deals.
"The OFT recommends that other companies operating similar policies review them carefully. Businesses concerned that they are being prevented from setting their own prices should not hesitate to contact the OFT."