UK Sues Amazon

Posted by Janki Desai.

Amazon is one of the biggest suppliers in the world for many people, including internationally. With the help of Amazon, consumers can easily buy better-priced products, or so we think. Amazon was recently faced with a one-million-dollar lawsuit in the United Kingdom against their “feature offer” button, leading to customers paying more for products instead of less. This meant that their better value deals were being hidden, so the pricier options were shown instead and are being filed with the Competition Appeal Tribunal in October.

The case explains that sellers on Amazon are constantly being ripped off through the Buy Box section. The article states that Amazon uses a “secretive and self-favouring algorithm to ensure that the Buy Box nearly always features goods sold directly by Amazon itself or third-party retailers who pay hefty storage and delivery fees to Amazon.” Buy Box is a section on Amazon that leads customers to choose “Buy Now” or “Add to Basket.” According to the specialist law firm conducting the litigation, Hausfeld, the damages from this will be around one billion dollars if it succeeds.

There have been too many instances where more prominent companies have taken advantage of smaller companies and their consumers. One of the partners of Hausfeld, Lesley Hannah, explains that the design of the Buy Box does the opposite of what Amazon advertises and instead makes it harder for customers to purchase cheaper products. On the other hand, an Amazon spokesperson stated that “without merit and we’re confident that will become clear through the legal process,” expressing that Amazon is very big on supporting the 85,000 businesses in the UK. Amazon stands up and explains that their company has always been about selling with low prices and fast delivery.

The Competition and Markets Authority inserted a probe into the United Kingdom Amazon company, fearing that it “may be anti-competitive and could result in a worse deal for customers.” These types of lawsuits are scarce in the United Kingdom as they “opt-out,” meaning it falls on every individual unless opted out. The change in the new law in the UK was one of the main reasons the “opt-out” method was used in different lawsuits against Meta and Google. Amazon will continue to fight this case as many people convert to the “opt-out” process.

Janki is majoring in finance and marketing at the Stillman School of Business, Seton Hall University, Class of 2025.