5 members of the US Home Judiciary committee wrote to Amazon’s chief government Sunday, and accused the corporate’s prime executives, together with founder Jeff Bezos, of both deceptive Congress or probably mendacity to it about Amazon’s enterprise practices.
The letter additionally states that the committee is contemplating “whether or not a referral of this matter to the Division of Justice for prison investigation is suitable.”
Addressed to Amazon CEO Andy Jassy, the letter adopted a Reuters investigation final week that confirmed that the corporate had performed a scientific marketing campaign of copying merchandise and rigging search ends in India to spice up gross sales of its personal manufacturers – practices Amazon has denied participating in. Jassy, a longtime Amazon government, succeeded Bezos in July.
The letter states that “credible reporting” within the Reuters story and up to date articles in a number of different information shops “straight contradicts the sworn testimony and representations of Amazon’s prime executives – together with former CEO Jeffrey Bezos.”
“At finest, this reporting confirms that Amazon’s representatives misled the Committee. At worst, it demonstrates that they could have lied to Congress in doable violation of federal prison regulation,” the letter states.
In response, an Amazon spokesperson issued an announcement that mentioned: “Amazon and its executives didn’t mislead the committee, and we’ve denied and sought to right the file on the wrong media articles in query.”
It added: “As we’ve beforehand said, we’ve an inner coverage, which works past that of some other retailer’s coverage that we’re conscious of, that prohibits using particular person vendor information to develop Amazon non-public label merchandise. We examine any allegations that this coverage could have been violated and take applicable motion.”
Since 2019, the Home Judiciary Committee has been investigating competitors in digital markets, together with how Amazon makes use of proprietary vendor information from its platform, and whether or not the corporate unfairly favors its personal merchandise.
In sworn testimony earlier than the Judiciary Committee’s antitrust subcommittee final yr, Bezos mentioned the corporate prohibits its workers from utilizing information on particular person sellers to learn its personal private-label product traces. In one other listening to in 2019, Nate Sutton, Amazon’s affiliate common counsel, testified that the corporate doesn’t use such information to create its personal branded merchandise or alter its search outcomes to learn them.
Requested in the course of the 2019 congressional listening to whether or not Amazon alters algorithms to direct customers to its personal items, Sutton replied: “The algorithms are optimised to foretell what clients need to purchase whatever the vendor.”
The lawmakers’ letter offers Jassy “a last alternative” to supply proof to corroborate the corporate’s prior testimony and statements. It additionally notes that “it’s criminally unlawful to knowingly and wilfully make statements which can be materially false, conceal a cloth truth, or in any other case present false documentation in response to a congressional investigation.”
It offers the CEO till November 1 to supply a sworn response to make clear “how Amazon makes use of private particular person vendor information to develop and market its personal line of merchandise” and the way Amazon’s search rankings favour these merchandise.
It additionally requests copies of all paperwork talked about within the October 13 Reuters investigation.
“We strongly encourage you to utilize this chance to right the file and supply the Committee with sworn, truthful, and correct responses to this request as we contemplate whether or not a referral of this matter to the Division of Justice for prison investigation is suitable,” the letter states.
The Reuters probe was based mostly on 1000’s of pages of inner Amazon paperwork – together with emails, technique papers and enterprise plans. They confirmed that, at the least in India, Amazon had a proper, clandestine coverage of manipulating search outcomes to favour Amazon’s personal merchandise, in addition to copying different sellers’ items – and that at the least two senior firm executives had reviewed it.
In response to the Reuters report, Amazon mentioned, “We consider these claims are factually incorrect and unsubstantiated.” The corporate didn’t elaborate. The corporate mentioned the way in which it shows search outcomes does not favour private-brand merchandise.
The lawmakers’ letter additionally cites different current tales within the Markup, the Wall Road Journal and the Capitol Discussion board about Amazon’s private-brand merchandise and use of vendor information.
The letter’s sharp wording ratchets up the rhetoric between Washington and Massive Tech. Firms together with Amazon, Fb Inc, Apple Inc and Alphabet Inc’s Google have been underneath rising scrutiny in Washington, Europe and different components of the world, fuelled by considerations amongst regulators, lawmakers, and shopper teams that the companies have an excessive amount of energy and are participating in unfair practices that damage different companies.
The lawmakers’ letter was signed by a bipartisan group, and included the judiciary committee’s chairman, Democrat Jerrold Nadler, and 4 members of the antitrust subcommittee – its chair, Democrat David Cicilline, vice chair Pramila Jayapal, and Republicans Ken Buck and Matt Gaetz.
On Wednesday, following publication of the Reuters investigation, US Democratic Senator Elizabeth Warren, a outstanding critic of Amazon, known as for breaking apart the corporate. In India, a bunch representing thousands and thousands of brick-and-mortar retailers urged Prime Minister Narendra Modi’s authorities to take motion in opposition to Amazon.
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