BNR – American regulators have taken Amazon to court, alleging the e-commerce giant is unlawfully maintaining a monopoly on the market.

The Federal Trade Commission (FTC) has said that the company deploys “a series of interconnected anti-competitive and unjust tactics”

Furthermore, the FTC claimed that the company inflates prices in a strategy to eliminate competition.

Amazon has categorically refuted these claims, asserting that the lawsuit is “factually and legally flawed.”

This lawsuit is the most recent instance of tech giants encountering legal challenges from US regulators.

FTC Close Monitoring

The FTC, led by Lina Khan, has been closely monitoring Amazon’s operations for several years.

Khan, who became FTC Chair in 2021, has made addressing issues of tech monopolies a focal point of her tenure.

Back in 2017, Khan published a substantial academic paper that argued Amazon had largely escaped antitrust scrutiny. She also claimed that Amazon had steadily advanced toward monopolistic status.

Since her appointment, the prospect of this lawsuit has been widely anticipated and a critical test for Khan.

The concentrated power of a small number of tech giants has led certain US lawmakers to call for measures to bolster competition in online search, e-commerce, and social media.

However, the FTC, under Khan’s leadership, has faced setbacks in its confrontations with big companies.

Pressure Following Amazon Lawsuit

In February, it failed in its bid to halt Meta’s acquisition of VR company Within. In July, it similarly failed to obstruct Microsoft’s purchase of the creator of Call of Duty.

Consequently, there is significant pressure on Khan and the FTC to secure a notable legal victory.

The FTC argues that Amazon exerts monopolistic control, inhibiting competitors and sellers from lowering prices.

Moreover, the regulator asserts that Amazon’s actions result in deteriorating quality for consumers and overcharging sellers.

However, Amazon said if the lawsuit were to succeed, it’d lead to a reduction in product choices and higher prices.