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SMALL BUSINESS RISING STATEMENT ON INVESTIGATION INTO AMAZON

Business • March 9, 2022

Contact: Jess Del Fiacco, delfiacco@ilsr.org

WASHINGTON, D.C. (March 9, 2022) – The following statement was issued by Small Business Rising, a coalition of nearly 30 national and local associations representing over 150,000 small and independent businesses, including the National Sporting Goods Association (NSGA), in response to a letter from Members of the House Judiciary Committee urging the U.S. Justice Department to investigate potentially criminal conduct by Amazon and its senior executives.

“We applaud the House Judiciary Committee Members for their leadership and commitment to addressing Amazon’s growing monopoly power and commend the Committee for its letter urging the U.S. Justice Department to investigate potentially criminal conduct by Amazon and its senior executives.

“During the Committee’s investigation into Big Tech’s abusive conduct, Amazon and its executives’ goal was to conceal the ways its business model relies on abusive and anticompetitive tactics to maintain its dominance over small and independent businesses. The bottom line is America’s independent businesses and entrepreneurs cannot succeed in a world where the tech giants are allowed to remain all-powerful gatekeepers where they can impose exorbitant fees, demand oppressive terms, and extract valuable data from independent manufacturers and retailers that depend on its platform. 

“Amazon and its executives’ actions to obstruct the Committee’s investigation underscore the need for Congress to address Big Tech’s outsized power. We commend the committee for referring this matter to the Department of Justice, and we urge the department to investigate Amazon and its executives, including for potential criminal conduct.”

Comment from Douglas Mrdeza

CEO and Founder, Top Shelf Brands, and member of Small Business Rising

“As a third-party seller on Amazon’s platform, I experienced the hardship and pain that comes when Amazon engages in anticompetitive practices, from stealing trade secrets to engaging in predatory pricing. After experiencing these tactics first-hand, I’m convinced that structural separation must be part of any legislative solution aimed at Amazon. The company’s ‘blending’ of its various lines of business lies at the root of all the problems small businesses have with Amazon, and only breaking these businesses apart and making them stand and compete on their own will address the problem.

“As I saw first-hand, Amazon presents itself as a partner, but in reality, it’s a competitor that steals proprietary information and uses it to put third-party sellers out of business. This bipartisan Senate legislation is a welcome first step. Our Small Business Rising coalition looks forward to working with the Judiciary Committee on the legislation we need to ensure small businesses are allowed to compete online.”

At issue are Amazon’s responses to lawmakers’ inquiries about how it uses the data of third-party sellers on its platform when creating private-label products, and how it treats those Amazon brands in its search results.

Amazon executives repeatedly told members of the House committee in testimony and written responses that it doesn’t use the data of individual third-party sellers to inform the vast lines of its own brands, and doesn’t privilege its own products in the search results on its platform.