EU to Launch More E-Commerce Antitrust Investigations

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The European Union plans to launch more antitrust investigations into e-commerce companies after a two-year inquiry uncovered business practices that restrict competition, the EU executive said it had found an increased use of contractual restrictions to control product distribution, which could be in breach of EU antitrust rules.Certain practices by companies in e-commerce markets may restrict competition by unduly . limiting how products are distributed throughout the EU.

The e-commerce sector inquiry is part of the European Commission’s campaign to overhaul the bloc’s digital market in a bid to boost growth and catch up with the United States and Asia.The Commission collected about 8,000 distribution and licence agreements and gathered information from retailers, manufacturers, price comparison websites, e-commerce platforms and providers of films, sports, fiction, TV and music.

The insight gained from the sector inquiry will enable the Commission to target EU antitrust enforcement in European e-commerce markets, which will include opening further antitrust investigations.The EU executive found that manufacturers increasingly use selective distribution systems where products can only be sold by pre-authorised sellers, giving them more control over distribution, price and brand image.The online shopping platform welcomed the report and encouraged the Commission to launch targeted investigations.

The report also shows that marketplace bans prevent a significant number of small business entrepreneurs from selling products on online marketplaces and that these bans harm consumers by limiting choice, increasing prices and hindering cross-border trade.Some licensing practices may also make it more difficult for new online business models and services to emerge, the Commission said. It pointed to long-term licensing agreements between rights holders and distributors as a possible barrier to new entrants.EU antitrust scrutiny of the pharmaceutical, energy and financial services industries over the past decade prompted investigations into companies in all three sectors.

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