The Italian antitrust authority has imposed a heavy $196 million (200 million euros) fine on Apple and Amazon for violating EU rules by forming an alleged “anti-competitive cooperation in the sale” of Apple and Beats products. Reuters reports that in 2018, the two U.S tech giants signed a deal to allow only selected resellers to sell Apple and Beats products on Amazon which is against EU rules and undermines competition on prices.
Apple and Amazon ordered to remove the restrictions on retailers selling Apple and Beats products
To protect consumers from fake or counterfeit products, Amazon follows a ‘brandgating policy that requires third-party sellers to register and full fill the set criteria to sell branded products on its digital marketplace. This policy serves as a protective barrier against fraudulent vendors who are selling poor-quality products for premium prices.
However, the Italian regulators are not convinced by the company’s safety net and deem it anti-competitive. Therefore, the authority has imposed a 68.7 million euros fine on Amazon and a 134.5 million euros fine on Apple and has also ordered them to remove “the restrictions to give retailers of genuine Apple and Beats products access to Amazon in a non-discriminatory manner.” Brandgating is also a matter of concern for German and other regulators.
As per the report, both companies plan to appeal the fine and have denied any wrongdoing.
“To ensure our customers purchase genuine products, we work closely with our reseller partners and have dedicated teams of experts around the world who work with law enforcement, customs and merchants to ensure only genuine Apple products are being sold,” said Apple.
Calling the fine disproportionate and unjustified, Amazon also expressed strong disagreement with the decision and said that:
“We reject the suggestion that Amazon benefits by excluding sellers from our store, since our business model relies on their success. As a result of the agreement, Italian customers can find the latest Apple and Beats products on our store, benefiting from a catalogue that more than doubled, with better deals and faster shipping,” Amazon said.