Italy's antitrust regulator fined Amazon 1.13 billion euros ($1.28 billion) on Thursday for abusing its dominant market position, Zhitong Finance App learned.
Italy's antitrust regulator said Amazon used its dominant position to encourage sellers on its platform to use its logistics service, Amazon Logistics (FBA). Doing so "undermines the logistics services offered by competitors and reinforces its own dominant position."
The agency said it would take corrective action against Amazon.
Amazon said it "strongly disagrees" with the fine and plans to appeal. "The proposed fines and remedies are unreasonable and disproportionate," an Amazon spokesman said.
More than 50 per cent of annual sales on its platform in Italy come from smes, Amazon said, adding that their success is key to Amazon's business model.
An Amazon spokesman said: "Small and medium-sized businesses have multiple channels to sell their products online and offline, and Amazon is just one of them."
"We continue to invest to support the growth of the 18,000 Italian smes that sell on Amazon, and we provide multiple tools for sellers, including those who manage their own shipments."
Ruhell Amin, global head of retail equity research at William O 'Neil + Co, said it was a "significant" fine for the e-commerce giant.
"This is part of a broader trend we are seeing in Europe to try to regulate some of the big tech companies," he said.
Amin said the concern for investors was that the Italian fine could signal a broader trend towards tighter regulation of Amazon in other areas of its business, as well as in other parts of the world. "This seems to be the tip of the iceberg," he said.
Amin adds: "The case is interesting because the European Commission opened its own investigation into the practice but excluded Italy from the investigation, allowing the Italian antitrust regulator to deal with it on its own merits." "Normally, the Commission's approach is quite consistent."
Amazon was down nearly 1% premarket as of press time.