Amazon.com, Inc. AMZN is urging its third-party vendors to oppose proposed antitrust legislation, which it says could “impair” the company’s ability to operate its service.
What happened: Dharmesh MehtaAmazon’s vice president for worldwide selling partner services, wrote a letter to the company’s third-party sellers and explained the company’s opposition to the US Innovation and Choice Act in line.
Mehta wrote that the bill could “impair Amazon’s ability to operate a marketplace service and, therefore, your business’s ability to sell in our store.”
Amazon’s vice president encouraged Amazon sellers to read a company blog titled “Antitrust Law and the Unintended Negative Consequences for American Consumers and Small Businesses.”
The blog post set out Amazon’s opposition to the bill sponsored by Sen. Amy Klobuchar (D-Minn.) in detail. The Jeff Bezos founded company said the proposed legislation “targets” a handful of companies such as Amazon, Apple Inc. AAPL, Meta Platforms Inc Facebook and parent Google Alphabet Inc. GOOGL GOOG.
“In reality, Amazon’s consumer business (which this bill is largely aimed at) has a lot more in common with thousands of other retailers, like Walmart, Target, and Costco, all of which would be mysteriously excluded from regulations proposed by the bill.”
Mehta called on third-party sellers to join Amazon in opposing the bill and encouraged them to email senators. He said the Senate leadership intends to vote on the legislation later in June.
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Why is this important: The antitrust bill is also backed by the ranking member of the Judiciary Committee Representative Chuck Grassley (R-Iowa). The legislation aims to target companies that allegedly rank their products higher than their competitors in their market to generate more profits.
Amazon said in the blog that Target company TGTheadquartered in Klobuchar’s home state of Minnesota, is excluded from the bill’s provisions, even though it operates an online marketplace for sellers.
The e-commerce giant said it was continuing to open up its virtual retail shelves to third-party sellers, even though they would compete with its own direct retail business – Amazon called it a bold decision.
The company said there are more than half a million American business partners on Amazon and they are responsible for 1.8 million jobs in the country.
In 2020, The Wall Street Journal reported that Amazon was limiting its major competitors’ ability to buy advertising when their products competed with its own.
Price action: On Tuesday, shares of Amazon closed down 1.4% at $123 in the regular session and fell 0.5% in after-hours trading, according to data from Benzinga Pro.
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