FTC and 17 states sue Amazon on antitrust charges

The Federal Trade Commission has filed its long-anticipated antitrust lawsuit against Amazon.

In a sweeping complaint unveiled Tuesday, the FTC and attorneys general from 17 states accused Amazon of wielding its “monopoly power” to inflate prices, degrade quality for shoppers and unlawfully exclude rivals, thereby undermining competition.

The agency laid out a two-pronged strategy by which Amazon “unlawfully maintains” its monopoly power. It pointed to so-called anti-discounting measures the company uses to punish sellers and deter other online retailers from offering lower, more competitive prices than Amazon, which translates to keeping prices higher for products across the internet, the FTC said.

Amazon also “effectively requires” that sellers use its “costly” fulfillment services in order to obtain the vaunted Prime badge for their products, the FTC said, which in turn makes it more expensive to do business on the platform.

These tactics have stifled innovation, degraded the shopping experience on Amazon, the FTC added, and forced sellers to pay expensive fees to market their goods on the site, while facing no other choice “but to rely on Amazon to stay in business.”

David Zapolsky, Amazon’s general counsel and senior vice president of global public policy, said in a statement that the FTC’s complaint is “wrong on the facts and the law.”

“The practices the FTC is challenging have helped to spur competition and innovation across the retail industry, and have produced greater selection, lower prices, and faster delivery speeds for Amazon customers and greater opportunity for the many businesses that sell in Amazon’s store,” Zapolsky said in a statement. “If the FTC gets its way, the result would be fewer products to choose from, higher prices, slower deliveries for…