A controversial Apple-Amazon deal struck between tech giants back in 2018 has come under fire as Spanish antitrust regulators deem it illegal. Following a two-year investigation into alleged price-fixing, Spain’s antitrust watchdog has imposed hefty fines totaling $218 million on both companies.
This comes after similar investigations were conducted in Germany and Italy, with the concerns also resonating in the United States.
The Controversial Apple-Amazon deal
The roots of the case trace back to 2018 when Apple and Amazon reached a multi-country agreement to restrict the sale of Apple and Beats products solely to Apple-authorized resellers. This agreement spanned across several prominent markets, including the US, UK, France, Germany, Italy, Spain, Japan, and India, resulting in the establishment of an official Apple Store on Amazon’s platform.
The stated motive behind this collaboration was to ensure that all Apple products offered on Amazon were genuine, addressing the issue of counterfeit products in circulation. However, the deal drew sharp criticism from small resellers who claimed that their businesses were severely impacted, as the requirements for becoming an authorized reseller entailed reaching sales volumes in the millions of dollars.
Antitrust concerns and investigative actions
Antitrust regulators expressed grave concerns that this limitation on competition could lead to artificially inflated prices of Apple products, adversely affecting consumers. As a result, three countries, namely Germany, Italy, and Spain, initiated antitrust investigations to delve deeper into the potential anti-competitive practices.
In 2021, Italian regulators found both Apple and Amazon guilty of price-fixing and imposed fines of €134.5 million and €68.7 million, respectively. However, both companies successfully appealed the ruling, and the case was overturned in court.
The Spanish antitrust fine
Spain commenced its own investigation over two years ago, culminating in recent developments that saw both Apple and Amazon found guilty of colluding to restrict competition within the online sale of Apple devices and their competitors in Spain.
The Spanish antitrust watchdog has imposed substantial fines, amounting to €194.1 million ($218 million), on both companies. The regulators assert that Apple and Amazon unjustifiably restricted the number of Apple product sellers on Amazon’s platform in Spain, leading to the elimination of over 90% of Apple resellers. This resulted in a significant reduction in competition, subsequently driving up the prices of Apple devices available on Amazon.
Outlook and potential appeals
As of the time of writing, neither Apple nor Amazon have responded to the fines. However, based on previous experiences in Italy, it is likely that both companies will appeal the Spanish antitrust regulator’s decision.
The recent verdict by Spanish antitrust regulators serves as a significant blow to the Apple-Amazon deal, highlighting concerns over anti-competitive practices and their potential effects on consumers. With the hefty fines now imposed, the technology giants face mounting pressure and as appeals loom on the horizon, the outcome of this case could set a precedent for future partnerships between industry titans and their impact on market competition.
Meanwhile, Apple is getting ready to publicly release iOS 17 and this fine could be a slap in the face if not overturned. Nevertheless, if you wish to check it out, we have an ultimate guide to the latest iPhone update iOS 17.
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