‘PRICE PARITY PROVISION’

D.C. Attorney General Sues Amazon Over Seller Agreements, Alleging Price Fixing

The Washington, D.C., attorney general said Amazon’s contracts with sellers resulted in higher prices for consumers across the internet.

The Washington, D.C., attorney general has sued Amazon, alleging the e-commerce giant illegally fixes prices to the detriment of consumers. Karl Racine said in a Tuesday announcement that his office had filed an antitrust suit against Amazon, calling the company a monopoly. Racine alleged that Amazon’s business practices, specifically its contracts with third-party sellers, have resulted in higher prices and stifled innovation in online shopping. Amazon included a clause dubbed the “price parity provision” in its agreements with sellers until 2019, which prohibited the retailers from offering their products for lower prices on other online marketplaces than they did on Amazon. Racine said the provision led to “an artificially high price floor across the online retail marketplace.” Amazon responded in a statement: “The DC Attorney General has it exactly backwards—sellers set their own prices for the products they offer in our store.”