German anti-trust officials are investigating the non-price-compete contract clauses at Amazon (NASDAQ:AMZN), which require third-party sellers to not sell anywhere else for less. If the agency finds against Amazon—the Associated Press quoted the agency head as saying there was "considerable" evidence that Amazon is indeed breaching cartel rules—and if the ruling spurs other agencies in other countries (including the U.S.) to act, then this has the potential to be very disruptive to Amazon. Those third-party sellers are crucial to Amazon's seemingly infinite inventory, and the ability to offer the lowest price is critical to Amazon's strategy.
"Amazon's price parity clause, under which sellers are deprived of their freedom to sell a product offered through Amazon cheaper on another Internet sales channel, could violate the general ban on cartels," said Andreas Mundt, the head of Germany's federal antitrust office (the Bundeskartellamt), on February 20.