Amazon Challenges EU’s Decision to Label it as a “Very Large Online Platform”
Amazon has lodged a challenge at the EU General Court against the European Commission’s decision to include it on a list of Big Tech firms facing extra scrutiny under the eurozone’s new content-moderation rules. The company argues that the designation is discriminatory and violates the principle of equal treatment. Amazon maintains that it is committed to protecting customers from illegal products and content, but does not fit the description of a “very large online platform” under the Digital Services Act, which it claims should not be applied to it.
The EU passed the Digital Services Act last year in response to what it perceived as a failure by powerful firms to combat illegal material on their platforms. The legislation requires online marketplaces, including Amazon, to trace sellers on their platform, provide methods for customers to flag illegal content, and conduct random tests for illegal products. Companies with more than 45 million monthly active users are classified as “very large online platforms” and must adhere to stricter criteria and submit risk assessments. Failure to comply by August 25 could result in penalties of up to 6% of annual revenue.
Amazon argues that it should not be considered a “very large online platform” because the majority of its revenue comes from retail, rather than advertising. The company also contends that it is not the dominant retailer in any of the EU countries where it operates, pointing out that other national marketplaces, such as Poland’s Allegro, have not been designated as VLOPs. Amazon claims that if the designation were to be applied to it and not to other large retailers across the EU, it would be unfairly singled out and burdened with administrative obligations that do not benefit EU consumers.
The European Commission has stated that it will defend its position in court and has emphasized that Amazon must still comply with the rules by the end of August, irrespective of the appeal. The commission argues that the scope of the Digital Services Act covers all platforms that expose their users to content, including the sale of products or services that may be illegal. It maintains that the risks associated with wide user reach increase the platforms’ responsibilities to address them, whether they are marketplaces or social networks.
Zalando, a German online fashion firm also affected by the legislation, has already filed a lawsuit, claiming that the commission misinterpreted its user numbers and that the company generates most of its revenue from retail rather than advertisements.
Amazon’s challenge at the EU General Court highlights the ongoing tension between Big Tech companies and regulatory bodies seeking to ensure the responsible handling of content on digital platforms. The outcome of this case could have significant implications for how online marketplaces are regulated in the future.