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Amazon Japan cut its own prices, then billed sellers for the difference

Amazon Japan matched rivals' lower prices and billed sellers the margin — antitrust scrutiny forced it to repay 1,400 of them ¥2 billion.

Amazon Japan · 2020-09-10

What happened

From 2018, Amazon Japan ran two practices Japan's Fair Trade Commission began investigating as a possible abuse of superior bargaining position under the Antimonopoly Act. First, when Amazon cut its own resale price on a product to match a cheaper price elsewhere, it charged the difference back to the third-party seller or vendor supplying that product — the seller absorbed a price cut it hadn't agreed to. Second, Amazon introduced a vendor program and billed suppliers a cooperation fee of up to roughly 10% of sales for it.

Under a commitment procedure introduced in Japanese antitrust law in December 2018, Amazon avoided a formal finding of violation by submitting its own remediation plan instead of contesting the case. On 10 September 2020 the JFTC approved that plan: Amazon committed to repay approximately 2 billion yen (about $18.85 million) to roughly 1,400 sellers and vendors and to stop both practices going forward.

The JFTC's own release was explicit that approving the plan was not a determination that Amazon had violated the law — the commitment procedure let Amazon close the investigation by fixing the practice rather than by having a violation proven against it. It was Amazon's second brush with the JFTC over seller terms: a 2017 investigation into price-parity clauses forcing sellers to give Amazon their lowest price had already ended with Amazon deleting the clauses rather than face a ruling.

Why it happened

  • Charging a supplier for a price cut it didn't choose turns a routine competitive move into an unpaid bill the supplier has no way to dispute in advance.
  • A 10% cooperation fee for a self-created vendor program works only as long as sellers have nowhere else to sell — which is exactly the leverage an antitrust regulator is watching for.
  • Settling by commitment plan rather than contesting the case meant Amazon paid a real repayment bill without ever having a violation formally established against it.
What it cost¥2B (~$18.85M) repaid to 1,400 sellerscostly

The lesson

A marketplace that is also the referee on price can quietly move its own costs onto the sellers it hosts — regulators watching for abuse of bargaining power don't need a fine to make that expensive.

Aftermath

The JFTC opened a third, separate antitrust matter against Amazon Japan in November 2024, inspecting the company over suspicions it again pressured third-party sellers on pricing and use of its logistics services — an open investigation with no resolution reported as of these sources.

Sources

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    Somewhere, someone solved the problem this company failed at. 2nd Opinion →