Amazon abandon Price Parity Policy

Amazon-Abandon-Price-Parity-PolicyAs of today, 30th August 2013, Amazon is to end their Price Parity Policy which restricts its sellers from offering lower prices on other online sales channels, across its Marketplace in the European Union.

What this means for you is that you’ll no longer have to match prices on your website or other marketplaces with the price that you offer on Amazon. What it means for consumers is that when buying from a third party seller on Amazon they can no longer presume that it’s the lowest price that retailer offers without checking around on the net.

In reality competition from retailers and Amazon retail is likely to ensure that prices don’t rise steeply in the run up to Christmas.

The change of heart from Amazon comes after the OFT launched an investigation in October 2012, into suspected anti-competitive arrangements by Amazon relating to online retail. This investigation was being conducted under Chapter I of the Competition Act 1998 and Article 101 of the Treaty on the Functioning of the European Union.

The OFT has not reached a decision as to whether there has been an infringement of competition law, but Amazon have informed the OFT that they plan to end their Marketplace price parity policy in the European Union. In light of this decision, the OFT is currently minded to close its investigation on grounds of administrative priority.

The OFT said “As Amazon operates one of the UK’s biggest e-commerce sites, the pricing on its website can have a wide impact on online prices offered to consumers elsewhere. We are pleased that sellers are now completely free to set their prices as they wish, as this encourages price competition and ensures consumers can get the best possible deals“.

It’s important to note that no assumption be inferred that there has been an infringement of competition law.