In a decision dated 14 January 2021 in preliminary injunction proceedings (Case No. 37 O 32/21), the Munich I Regional Court, under threat of an administrative fine of up to EUR 250,000, prohibited Amazon from deactivating a seller account and related measures, such as the retention of seller credit, citing Amazon’s market power.
In its GTC, Amazon reserves the right to restrict, suspend or terminate the access of sellers without stating a reason, subject to a notice period of 30 days, or in the case of a material breach (after unsuccessful request to remedy the breach) without notice. In the present case, Amazon had blocked the applicant’s seller account on the grounds that the applicant had “possibly” offered unlawful remuneration for customer reviews, without the applicant having had the opportunity to counter this accusation in the absence of further information from Amazon.
Relying on the German Federal Cartel Office’s case report of 17 July 2019 on Amazon’s GTC and a press release of the EU Commission of 10 November 2020, the Regional Court affirmed a dominant position of Amazon in online trading via internet platforms. Pursuant to Section 19 of the German Act Against Restraints of Competition, GWB, (or Article 102 TFEU in European cases), companies with a dominant market position are prohibited from abusing their market dominance. Section 19 (2) GWB mentions, amongst others, the abusive obstruction of or discrimination against other companies as well as the charging of different prices or other conditions without an objective justification as standard examples.
In the present case, the Regional Court came to the conclusion that Amazon unfairly impeded the seller in offering its goods (Section 19 (2) no. 1 GWB), as Amazon did not give it a reasonable opportunity to respond to the allegations. Consequently, the Regional Court restricted Amazon’s freedom of decision with regard to entering into or terminating business relationships and obliged Amazon to act in a non-discriminatory and factually justified manner, such as a concrete justification of the alleged conduct, in order to enable the applicant to actually respond thereto and accordingly to dispel the allegations.
For sellers on Amazon Marketplace, this means that not every blocking of a seller account has to be accepted without resistance. Rather, it must be examined in each individual case whether Amazon’s conduct can be qualified as abuse of a dominant market position and whether legal protection can be sought against this behavior. At the same time, action must be taken quickly in such a case, as interim legal protection can only be successfully applied for within narrow time limits.
