Amazon.com AMZN executives may want to hold off celebrating Prime Day as the European Union confirmed a formal antitrust investigation.
What Happened
The E.U. will explore if Amazon is gaining an unfair advantage by operating a marketplace where independent companies can sell their products while simultaneously Amazon sells its own first-party products, according to CNBC.
At issue is Amazon's potential use of data it can gather from the independent companies on its platform and if the company uses this information for its own benefit. The regulatory body said this may be the case "based on the Commission's preliminary fact-finding" investigation.
Amazon said in a statement obtained by CNBC it will "cooperate fully" with the European Commission and "continue working hard to support businesses of all sizes and help them grow."
Why It's Important
The E.U.'s investigation comes barely a week after France approved a new tax on American big tech companies, including Amazon. The Trump administration argued the European nation is "unfairly" targeting American companies.
The argument that the E.U. unfairly targets American companies is one that was made before the Trump administration took office. Former U.S. Treasury Secretary Jacob Lew said it's not right for "tax authorities in other jurisdictions to reach into our tax base."
If the investigation concludes Amazon is guilty in violating competition rules, the E.U. could impose a penalty up to 10% of its global annual revenues.
Amazon shares traded around $2,003 in Wednesday's pre-market session.
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