Amazon is being fined $10.7 million by Italy’s antitrust authority for unfair business practices, with the charges stemming from its “Subscribe and Save” program.
Two of the e-commerce titan’s subsidiaries have been named by the Italian Competition Authority (AGCM) body for making recurring delivery the default option when a customer checks out on the site.
“The option ‘recurring purchase’ is pre-set instead of ‘one-time purchase’ for a wide selection of products on the marketplace,” the regulatory body said in a statement. “The pre-ticking of recurring purchase induces one to periodically buy a product—even without the effective need—thus limiting one’s freedom of choice.”
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AGCM said Wednesday that it has imposed the 10-million-euro fine on Luxembourg-based Amazon Services Europe S.à r.l. as well as Amazon EU S.à r.l. It said that its investigation revealed that the Seattle-based conglomerate applies the “recurring purchase” option as a pre-selection on products sold both by Amazon and its third-party sellers.
“[T]he conduct implemented by the company was deemed contrary to the standards of professional diligence,” it asserted. “As a major operator, Amazon is expected to design its online interfaces, particularly those related to purchasing processes, in a manner that allows consumers to make free and informed commercial decisions.”
Amazon has contested the findings and will appeal AGCM’s decision, a company spokesperson told Sourcing Journal.
“Every day customers benefit from the Subscribe and Save program by saving money and time on regular deliveries of items they routinely use,” they added. “Since its launch in Italy, customers on Amazon.it have saved more than 40 million euro thanks to Subscribe and Save orders.”
“Our priority has always been on earning and maintaining customer trust and we will continue to work hard to provide customers with a great shopping experience with low prices, great selection and fast delivery,” the spokesperson said.
At the beginning of its probe into the practice, AGCM said it also looked into Amazon’s pre-selection of its paid fast delivery option. Amazon settled the matter with the regulator, committing to only pre-select the free delivery option going forward. The two subsidiaries will also compensate any shoppers who contacted their customer service department to protest the conduct during 2023.
This isn’t the first time Amazon has come up against the Italian watchdog group.
In 2021, AGCM levied a 1.1-billion-euro fine ($1.3 billion) against the corporation for pushing its marketplace sellers to use its Fulfillment by Amazon (FBA) service over other providers, just months after Luxembourg’s privacy regulator slapped Amazon with an $887-million fine for flouting European data protection laws.
At the time, AGCM said Amazon manipulated third-party sellers by tying FBA usage to exclusive benefits that it deemed essential to reaching shoppers and maximizing sales on Amazon.it, like Prime delivery. The regulator decried the scheme as “abusive,” as logistics rivals were effectively boxed out by the strategy.
