Amazon Japan suspected of forcing retailers to cut product prices

Japan's antitrust watchdog conducted an on-site investigation of the Japanese unit of Amazon.com Inc. on Tuesday for allegedly forcing retailers to cut prices of products sold on its online shopping website, sources close to the matter said.

Amazon Japan G.K. is alleged to have violated the antimonopoly law by forcing retailers to reduce prices in return for displaying their products in the most visible positions for users of its platform, with the involvement of its U.S. headquarters also suspected.

The move comes as U.S. and European antitrust authorities are reported to have ramped up their probes into the tech giant over suspicions of pressuring third-party sellers inappropriately by taking advantage of its dominant position.

The Amazon e-commerce site has a "marketplace" for outside retailers to sell their products in addition to selling its own goods. Vendors recommended by Amazon will be displayed in the designated area, which can be easily found by users.

Amazon requires retailers who wish to appear in the area to "sell products at competitive prices," and is suspected of threatening to withdraw their products if they refuse to lower prices below those of rival online shopping platforms, the sources said.

The Japan Fair Trade Commission considers such acts as breaching the antimonopoly law prohibiting companies from abusing their power based on their dominant bargaining position and conducting transactions with restrictive terms.

The watchdog is expected to seek information from retailers about their transactions with Amazon in the near future, the sources said.

Amazon Japan was also probed by the watchdog for violating the antitrust law in 2016 and 2018.