CAP backs, Amazon decries legislation to restore online competition

A new report by CAP emphasises how the American Innovation and Choice Online Act will benefit consumers and small businesses and spur innovation.

The legislation would help small businesses by offering “an improved chance at growing a business that is not undermined by anti-competitive actions from the platforms on which they rely to reach consumers”.

CAP praised the legislation as “likely to protect American consumers, small businesses, and innovation online,” adding that Congress should take “meaningful action to enhance consumer choice and competition online by passing this bipartisan bill into law.”

“By purposefully targeting the anti-competitive practices of most concern, the bill offer[s] the United States a means to materially improve consumer choice in the near term and create a more dynamic online economy in the long term,” the CAP report said.

“American Innovation prohibits a number of unfair, discriminatory behaviours for covered platforms, giving competitors a chance to innovate and a fair shot at providing new choices to the American people,” it said.

The legislation would “help unlock the potential of Americans to grow successful businesses and build an economy that is more prosperous, equitable, and innovative…introducing competitive incentives for improved quality, innovation, and competitive prices for American consumers.”

“The bill can immediately remove barriers that cause significant inconveniences between popular services on covered platforms…over time, this bill will reduce costs and increase choices for consumers,” the report added.

The bill would mandate that Amazon allow other logistics providers to fulfill Amazon Prime orders, and such a mandate would make it difficult, and potentially impossible in practice, for Amazon and its selling partners to offer products with Prime’s free two-day shipping, he wrote.

There are now over 500,000 US selling partners using Amazon today, and together, they are responsible for more than 1.8 million jobs in the United States.

“Unfortunately, the proposed legislation could meaningfully jeopardize our marketplace. There are a myriad of broadly written restrictions aimed at the concept of self-preferencing that prohibit commonplace retail practices (e.g., utilising usage and buying data from our stores to personalise consumers’ customer experience, ordering search results by Prime eligibility, etc.),” Brian Huseman, Amazon vice president of public policy, wrote on its website.

Huseman alleged that the legislation is ‘inappropriately’ targeted at only Amazon. This has been accomplished by requiring a market value of at least $550 billion to qualify for regulation.

“If Congress believes that the highly competitive retail industry needs regulation, we welcome the opportunity to engage in identifying and addressing legitimate concerns lawmakers may have. But the proposed bills that Congress is now considering, which attempt to broadly cover five companies, each with a vastly different business model, should be reconsidered,” he added.

Fibre2Fashion News Desk (DS)