Amazon’s price control scheme prohibited as German Antitrust watchdog orders EUR 59 million disgorgement

Germany's Federal Cartel Office (FCO) has banned Amazon's automated price control mechanism on the Amazon Marketplace in Germany and ordered disgorgement of EUR 59 million in economic benefits.

This is a landmark decision in Germany – both as a signal of increasing global scrutiny of automated pricing mechanisms and as the first use of the FCO's expanded disgorgement powers.

Amazon’s automated price cap mechanism explained

Amazon operates a marketplace where both third-party sellers and Amazon Retail sell goods. Third-party sellers account for around 60% of sales, with Amazon itself selling the remaining 40%.

According to the FCO, Amazon uses algorithms, statistical models, heuristics, and other calculation methods including machine learning to monitor marketplace sellers' prices. Drawing on pricing data from current and previous offers on its own platform and external competitors, Amazon calculates dynamic, changing price caps for marketplace offers.

Offerings that exceed these price caps, will either be removed from the platform or excluded from a prominent promotional space called Buy Box or Featured Offers in the following scenarios: 

Overview: Price Control Scenarios on the Amazon Marketplace

Amazon's terms mention the possibility of offers being excluded but do not disclose how price caps are set or when visibility is lost. Sellers who trigger the mechanism receive notifications asking them to adjust prices. In Scenario 3, the price control mechanism also displays a competitive price to the vendor as suggestion.

But aren’t lower prices good for competition?

While the FCO emphasises that it does not want to prohibit lower prices for consumers, it notes that the strict price caps interfere with marketplace sellers' pricing freedom and can displace small and medium-sized sellers who can no longer cover their costs.

The FCO also noted that the systematic enforcement of the lowest observed external online price acts as a switching barrier for end customers and deters other online retailers from offering lower prices. Lower prices by other retailers outside of the Amazon marketplace would have little chance of success if the price were immediately replicated on Amazon’s platform. This discourages price competition outside of the Amazon marketplace. In the FCO’s view, less competition-damaging measures, such as reducing marketplace fees, could achieve the same goal without harming competition. 

The lack of transparency for sellers was another key concern. Such restrictions on offer visibility can cause significant revenue losses, since most marketplace revenue is achieved via the promotional space.

Overall, the FCO found the price control mechanism to be abusive, both under the special provisions for undertakings of paramount significance according to Section 19a(2) of the German Act Against Restraints of Competition (ARC) and under the general abuse of dominance provisions according to Section 19 ARC and Article 102 TFEU. The FCO had designated Amazon as company with paramount significance under Section 19a ARC in 2022, amongst others, due to Amazon’s market share in the market for online retail in Germany being 70%. The Federal Supreme Court (Bundesgerichtshof) has upheld the designation decision following Amazon’s appeal. 

What comes around, goes around

Going forward, the FCO prohibits Amazon from using the price control mechanism in the above described three scenarios. Further, Amazon may only use a price control mechanism in exceptional cases, such as price gouging, and must follow the FCO's specifications. Key requirements for these exceptional cases include: 

• Amazon cannot reduce Buy Box visibility based on price alone. Other relevant criteria such as stock availability and shipping speed must also be factored in and displayed in the Buy Box.
• Amazon cannot remove the Buy Box entirely simply because all retailers' prices fail to meet Amazon's expectations.
• Amazon must make its price control mechanism more transparent. Its terms and conditions must outline how the mechanism works, how often price caps are adjusted and what sanctions apply.

Affected sellers must receive a clear, case-specific notification including the affected product, the duration, the price that triggered the mechanism and the underlying threshold.

Rather than imposing a fine, the FCO ordered disgorgement of EUR 59 million – aiming to neutralise the advantage gained rather than punish the conduct.  This is the first use of the revised disgorgement powers introduced in 2023, which presume that (i) an infringement results in an economic advantage and (ii) that advantage amounts to at least 1% of relevant domestic turnover.

Amazon can appeal the decision directly to the Federal Supreme Court. 

Key takeaways for businesses

The decision underscores that national competition authorities play a complementary role alongside the Commission’s DMA enforcement – and that the FCO sees itself as a pioneer in regulating the tech sector.

More broadly, it signals increasing global scrutiny of automated pricing mechanisms. The decision is a warning not just for US tech companies — which have been the main targets of the FCO's paramount significance regime — but for all platform operators: ensure transparency around automated pricing. The FCO's first use of its expanded disgorgement powers here only underlines the message.