Australia’s competition watchdog has filed a lawsuit against Amazon, accusing the tech giant of using its market power to impose unfair contract terms on third-party sellers. The case, lodged in the Federal Court, alleges that Amazon’s standard agreements with merchants operating on its Australian marketplace were designed to “substantially lessen competition” and “unreasonably favour” the retailer. For British workers and small businesses, this legal action should serve as a pointed reminder: the same corporate muscle-flexing that squeezes suppliers in Sydney is tightening its grip on shopkeepers in Sheffield.
The Australian Competition and Consumer Commission (ACCC) claims that Amazon’s terms forced sellers to price their goods no lower on other platforms, a practice known as “most-favoured-nation” clauses, which effectively locked in Amazon’s dominance. It also says the company unilaterally changed contract terms without notice and restricted sellers’ access to customer data. These are not niche grievances. They speak to a broader pattern: the transformation of marketplaces into private fiefdoms where the platform dictates terms and takes a cut, while the people who actually produce the goods shoulder the risk.
Nowhere is this more acutely felt than in Britain’s struggling high streets and industrial towns. Small manufacturers and independent retailers, already battered by inflation and rising energy costs, increasingly rely on platforms like Amazon to reach customers. But the relationship is anything but equal. A 2023 report by the UK’s Competition and Markets Authority found that Amazon and Google dominate digital advertising and e-commerce, with little room for challengers. Meanwhile, unions including the GMB have documented warehouse workers in Coventry and Dunstable labouring under punishing productivity targets and insecure contracts. The same supply chain that squeezes businesses also squeezes their employees.
The Australian case lays bare the economic violence of these contracts. According to the ACCC, Amazon’s terms were not just tough: they were “designed to insulate Amazon from competition”. Sound familiar? In 2021, a group of cross-party MPs described Amazon’s UK tax arrangements as “immoral”. Now the Australian government is showing what a regulator with teeth can do. It is suing the company not for ripping off consumers, but for rigging the market against the little guy.
This should be a call to action for Labour and other political parties. The current government’s Digital Markets, Competition and Consumers Bill, which finally passed into law last year, gives the CMA new powers to designate firms like Amazon as having “strategic market status”. But the rubber has yet to hit the road. No company has been designated, and critics argue the regime is too slow and too weak. Meanwhile, voters in Red Wall seats are watching their local butcher, baker and bookseller close, replaced by Amazon lockers.
For British business leaders, the Australian lawsuit is a grenade thrown into the boardroom. If you are a supplier or a seller on Amazon, you know the score: you hand over your margins, your data, and your independence, or you get delisted. The ACCC’s case offers a glimmer of hope that the law can tip the scales back. But it will only work if regulators here follow suit.
The real test is not just about Amazon. It is about whether we believe that market power should carry responsibility. In the North, we have long known that when industrial giants hold all the cards, workers and small firms lose. The Australian action is a reminder that it doesn’t have to be this way. Regulators can be remade in the image of the economy they serve: fair, tough, and unafraid to take on the biggest names. British regulators should take note, and act.
