Amazon Sued for Not Letting Merchants Offer Lower Prices on Rival Sites
California is suing Amazon for allegedly banning sellers from offering lower prices on other sites.
On Wednesday, the state’s Attorney General Rob Bonta filed a lawsuit(Opens in a new window) that alleges Amazon has stifled competition and forced consumers to pay more for goods through its pricing practices.
The lawsuit centers on how merchants selling on Amazon “must agree not to offer lower prices elsewhere — including competing sites like Walmart, Target, eBay, and, in some cases, even on their own websites,” the attorney general’s office claims.
If merchants break the pricing agreement, they risk losing visibility—or access to—the Amazon platform. “Amazon coerces merchants into agreements that keep prices artificially high, knowing full well that they can't afford to say no,” Bonta added in a statement(Opens in a new window). “With other e-commerce platforms unable to compete on price, consumers turn to Amazon as a one-stop shop for all their purchases. This perpetuates Amazon's market dominance.”
The practice can also cause prices for retail goods to “artificially stabilize at levels higher than would be the case in a competitive market,” Bonta’s office said. “This occurs not because Amazon competed successfully or because it is a more efficient retailer and marketplace, but because Amazon forbids it through coerced agreements."
However, Amazon says it's confident the court will dismiss Bonta's lawsuit, citing how a judge rejected(Opens in a new window) a similar lawsuit from Washington D.C.'s Attorney General earlier this year.
"Sellers set their own prices for the products they offer in our store. Amazon takes pride in the fact that we offer low prices across the broadest selection, and like any store we
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