EU charges Amazon with a groundbreaking $887M GDPR fine over data misuse


European privacy regulator makes Amazon pay a  fine  of $887 million for violating the EU’s data protection laws.  Amazon’s European operations are headquartered  where The National Commission for Data Protection resides, in Luxembourg. The decision was set on July 16th, 20201. The National Commission for Data Protection in Luxembourg.

The maximum penalty in this case, could be as much as 10 percent of Amazon’s revenue. But these cases could drag on for many years to come – or even get dismissed. Amazon’s revenue was a massive $386 billion in 2020 with an increase of online ordering during the COVID-19 pandemic.

Amazon warned of slow growth in the next few quarters due to pandemic concerns, which has been a key indicator to dampen its global e- commerce operations. On this news, Amazon stock fell 7 % in early morning trading.

Amazon notes the following in the SEC filing:

On July 16, 2021, the Luxembourg National Commission for Data Protection (the “CNPD”) issued a decision against Amazon Europe Core S.à r.l. claiming that Amazon’s processing of personal data did not comply with the EU General Data Protection Regulation. The decision imposes a fine of €746 million and corresponding practice revisions. We believe the CNPD’s decision to be without merit and intend to defend ourselves vigorously in this matter.

Beginning in March 2020, with Frame-Wilson v., Inc. filed in the United States District Court for the Western District of Washington, a number of cases have been filed in the U.S. and Canada alleging, among other things, price fixing arrangements between, Inc. and third-party sellers in Amazon’s stores, monopolization and attempted monopolization, and consumer protection and unjust enrichment claims.

Some of the cases include allegations of several distinct purported classes, including consumers who purchased a product through Amazon’s stores and consumers who purchased a product offered by Amazon through another e-commerce retailer.

The complaints seek billions of dollars of alleged actual damages, treble damages, punitive damages, and injunctive relief. Individuals have also initiated arbitrations based on substantially similar allegations. We dispute the allegations of wrongdoing and intend to defend ourselves vigorously in these matters.

In addition, we are regularly subject to claims, litigation, and other proceedings, including potential regulatory proceedings, involving patent and other intellectual property matters, taxes, labor and employment, competition and antitrust, privacy and data protection, consumer protection, commercial disputes, goods, and services offered by us and by third parties, and other matters.

The outcomes of our legal proceedings and other contingencies are inherently unpredictable, subject to significant uncertainties, and could be material to our operating results and cash flows for a particular period.

We evaluate, on a regular basis, developments in our legal proceedings and other contingencies that could affect the amount of liability, including amounts in excess of any previous accruals and reasonably possible losses disclosed, and make adjustments and changes to our accruals and disclosures as appropriate.

For the matters we disclose that do not include an estimate of the amount of loss or range of losses, such an estimate is not possible or is immaterial, and we may be unable to estimate the possible loss or range of losses that could potentially result from the application of nonmonetary remedies.

Until the final resolution of such matters, if any of our estimates and assumptions change or prove to have been incorrect, we may experience losses in excess of the amounts recorded, which could have a material effect on our business, consolidated financial position, results of operations, or cash flows.

Antitrust regulator Margrethe Vestager, alleged in complaint Amazon uses substantial amounts of data and  information from its marketplace platform to be able to  identify  the most popular products consumers are buying by outside vendors on its website. It then in turn  then offers equivalent products itself, sometimes at lower prices, undercutting its own third-party vendors.


Image Tony Webster




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