House antitrust committee accuses Amazon of lying to Congress, asks DOJ to investigate

The House of Representatives Antitrust Subcommittee on Wednesday accused Amazon of lying to Congress about how it treats third-party sellers, including whether it prefers its own proprietary brands and products in search results, citing a The Markup survey.

In a letter sent to the Justice Department on Wednesday, committee members asked the DOJ to investigate Amazon for “potentially criminal” obstruction of Congress.

Among the evidence cited by the committee was The Markup’s October investigation, which found that Amazon placed its own in-house and proprietary products ahead of higher-reviewed and best-selling third-party items in search results on its platform. form. Committee members say Amazon told them the company does not give its own products a head start in search results or use data it has collected from third-party sellers to inform design. and the marketing of products sold under its own brands.

The letter is the latest in a multi-year effort by the committee to investigate potentially anti-competitive practices by the e-commerce giant and other major tech platforms.

It was signed by Reps Jerrold Nadler (D-NY), David Cicilline (D-RI), Ken Buck (R-CO), Pramila Jayapal (D-WA), and Matt Gaetz (R-FL).

“The Committee has spent 16 months carrying out this fundamental truth-seeking function to uncover facts about the conditions of competition in digital markets, and Committee members have since proposed legislation to correct the problems uncovered by this investigation” , indicates the letter. “Yet throughout this process, Amazon has repeatedly tried to thwart the Committee’s efforts to uncover the truth about Amazon’s business practices. For this he must be held accountable.

Four days after The Markup published its investigation, the same committee sent Amazon a letter asking it to explain how its testimony might be true in light of The Markup’s investigation and an article published the previous day by Reuters citing internal Amazon documents about removing products from its Indian marketplace and boosting them in search results. This letter warned Amazon officials that lying to Congress was a crime.

According to Wednesday’s letter, a November 1 response from Brian Huseman, Amazon’s vice president for public policy, “provided no new information” and said The Markup had confused the search results with “routine product marketing” but had not responded to “Article Markup’s allegation that Amazon listed its own products first” in the search results grid” via “source code [that] identified [those products] as ‘sponsored’ – although this label is not shown to the public.’ ”

“Without producing any evidence to the contrary, Amazon left open what appear to be false and misleading statements to the Committee. He has refused to turn over any business documents or communications that would corroborate his claims or correct the record,” the letter reads. “As a result, we have no choice but to refer this matter to the Department of Justice to investigate whether Amazon and its executives obstructed Congress in violation of applicable federal law.”

Justice Department officials did not respond to a request for comment.

In an emailed statement to The Markup, Amazon pushed back against lawmakers’ claims that its officials lied. “There is no factual basis for this, as evidenced by the enormous volume of information we have provided over several years of good faith cooperation with this investigation,” the email read. sent by Amazon spokesperson Alex Haurek.

During a July 2019 hearing in an exchange with Cicilline, Amazon’s associate general counsel, Nate Sutton, insisted that the product listing that appears when a user searches on the platform -the company’s e-commerce form does not promote Amazon’s own brands. “The algorithms are optimized to predict what customers want to buy, regardless of the seller,” Sutton said. “We provide the same criteria.”

Amazon also affirmed the neutrality of its product search platform in a set of written responses sent to the committee a few months later, in October 2019. However, The Markup’s survey, published two years later, analyzed 3,492 popular product queries and found that Amazon consistently puts its own brand products first, above competitors’ products with higher ratings and more reviews.

Knowing whether a product was an Amazon brand or an exclusive was enough to predict whether Amazon would place it as the top search result seven times out of 10. It was a stronger predictor than the star rating of a user-reviewed product, the number of user reviews or four other factors that we have analyzed.

In 2020, the committee produced a lengthy report regarding its investigation into the anticompetitive practices of Amazon, Facebook (which has since been renamed Meta), Google and Apple.

“Amazon’s tendency to exploit sellers, enabled by its market dominance, raises serious competition concerns,” the report said.

Additional reporting by Leon Yin.