Amazon’s purchase of iRobot could encounter an obstacle in Europe. The most recent reports indicate that Amazon will not offer concessions to the European Commission in a bid to gain its approval. The authority established this Wednesday as the deadline for Amazon to respond to the questions and make changes to its business.
As reported Political, a source close to the operation confirmed that Amazon will not give concessions. The decision jeopardizes approval of iRobot purchase, valued at 1.7 billion dollars. The European Commission has until February 14, 2024 to determine whether to approve or veto the operation.
A few months ago it was rumored that the Commission would approve the purchase without conditions. However, the highest authority warned that iRobot acquisition may restrict competition in robot vacuum cleaner market. In a statement published at the end of Novemberthe European Commission said Amazon could hinder iRobot rivals’ access to its online marketplace.
“Amazon may have the ability and incentive to exclude iRobot’s rivals by engaging in various exclusion strategies aimed at preventing rivals from selling their products on Amazon’s online marketplace or degrading their access to it,” the company said. authority. “Amazon’s online marketplace is a particularly important channel for the sale of robot vacuum cleaners in France, Germany, Italy and Spain. “Customers in these countries especially trust Amazon, both in terms of product discovery and their final purchasing decision.”
According to the Commission, Amazon could reduce visibility or eliminate other manufacturers from the catalog of robot vacuum cleaners. It would also have the power to increase the cost for iRobot’s rivals to sell their products in the store.
Amazon will not offer concessions to the European Commission for the purchase of iRobot
The Commission launched an investigation to find out if Amazon’s purchase of iRobot could affect competition. After analyzing internal documents and collecting the opinion of other vacuum cleaner manufacturers and market participants, the authority concluded that there are incentives to affect iRobot’s rivals. Amazon would have an economic motivation to favor its devices, as is the case with other product lines.
The statement of objections was sent to Amazon for consideration. The company has until the end of Wednesday, January 10 to respond to the concerns, consult the file and request an oral hearing. According to the European Commission, the statement of objections does not prejudge the outcome of the investigation.
The authority established February 14 as the date on which it will decide whether to approve the purchase of iRobot or decide to veto it. Amazon is confident that a scenario like the one that occurred with the UK Competition and Markets Authority (CMA), who approved the acquisition without limitations. In the eyes of the CMA, iRobot has a modest market share, so there is no incentive for Amazon to stop selling similar devices from its competitors.
In a statement sent to PoliticaliRobot CEO Colin Angle stated that they continue to work with the European Commission and other regulators in their review of the merger agreement.