The Italian Competition Authority opens an antitrust investigation against Apple and Amazon for an on-line sale ban

Following the receipt of a report filed by an aggrieved reseller, by a decision made on 14 July 2020 the Italian Competition Authority (ICA) has opened an Article 101 TFEU investigation against Apple and Amazon in the case I842 (Vendita prodotti Apple e Beats su Amazon Marketplace orApple/Amazon Marketplace). The target of the ICA investigation is an agreement concluded by Apple and Amazon that would have imposed an online sales ban on the Apple products.

Retailers of Apple products are resellers that may be or not members of the Apple official distribution programme. Resellers that are not member of this network can lawfully sell Apple products as the Apple wholesalers supply them with such products.   

Apple and Amazon compete in the market for on-line retailing activities for consumer electronics products in which they are the two biggest players. Both of them sell the Apple and Beats goods while Amazon also sells its own devices in competition with Apple. In addition to that, Amazon is also active in the market for the provision of intermediation services for the sale of goods or services via on-line platforms. And the Amazon Marketplace is the most important player in this market. Finally, like Apple, Amazon also manufacturers consumer electronics products.

The ICA qualified the agreement signed by Apple with Amazon as a commercial agreement. Under the agreement, Apple would award the exclusive licence to sell its Apple and Beats products on the Amazon Marketplace only to Amazon and the members of the Apple official distribution network. This way, the resellers of the Apple products outside the Apple official distribution network would have no access to the intermediation service for online sales on the Amazon Marketplace even though they lawfully resell genuine Apple products supplied by authorised  wholesalers.

Importantly, precluding access to the Amazon Marketplace would constitute a considerable entry barrier to the market on-line retail sale activities for electronic products for the non-official Apple resellers, reducing the on-line offer of Apple and Beats devices. For this reason, the Apple-Amazon agreement appears to infringe Article 102 TFEU because it limits or control production of Apple and Beats goods. The feared foreclosing effects would be further magnified by the increasing importance of e-commerce in the current economic climate. Such effects would be particularly harmful for smaller national dealers that rely on on-line platform to reach out several potential customers. Logically, that would reduce the number of firms that resells Apple products via the Amazon Marketplace, thereby reducing the number of retailers competing with Amazon and the members of the Apple official distribution network.

Reducing the number of retailers active on the Amazon Marketplace, the agreement might also reduce the incentives for the resellers to effectively compete on prices of Apple and Beats products. The feared restrictions would also hamper the correct working of the internal market, limiting the parallel import of those products across EEA.

The ICA also believes that the obligations arising from the Apple-Amazon agreement are reciprocal: Apple admits Amazon to its the official distribution network in exchange for Amazon exclusively supplying its marketplace services only to the members of the Apple official distribution network.  official resellers, amongst which Amazon itself, access to the Amazon marketplace.

In essence, in Apple/Amazon the ICA has to consider the competition compliance of an on-line resale ban targeting the retail activities of the unofficial resellers of Apple and Beats products on the Amazon Marketplace. Interestingly, in this case the contested vertical restraint is not imposed in the distribution contracts concluded by the manufacturer with the manager of the e-commerce platform. On the contrary, the restraint is laid down in a commercial agreement entered into by the manufacturer and the manager of the e-commerce platform, which also direct competitors in the markets for the production and commercialization of consumer electronics products.


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May 18, 2021 at 6:16 AM
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