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Amazon sued over alleged overcharging of advertising fees to more than 1 million businesses
🇨🇭 Switzerland /Economy & Trade

Amazon sued over alleged overcharging of advertising fees to more than 1 million businesses

From Le Temps · () French

Translated from French and summarized by DistantNews. Read the original for the full story.

At a glance

News Official statement In the courts
  • The FTC and 22 U.S. states sued Amazon in federal court in Seattle, alleging that it manipulated advertising auctions and overcharged 1.2 million advertisers since 2019.
  • The complaint says the alleged practices affected more than 500,000 small and medium-sized businesses and generated over $20 billion in additional revenue.
  • The case relies on internal documents and is the third major FTC action against Amazon, alongside a separate antitrust trial scheduled for March 2027.

Amazon faces a new U.S. legal challenge over the advertising auctions that place sponsored products at the top of its search results. The Federal Trade Commission and 22 states accuse the Seattle-based company of secretly and systematically overcharging 1.2 million advertisers.

misguided

— AmazonThe company’s characterization of the FTC and states’ lawsuit.

The complaint, filed in federal court in Seattle, says more than 500,000 of those advertisers were small and medium-sized businesses. Regulators allege that Amazon manipulated auctions used to set the price of some promotional tools, generating more than $20 billion in additional revenue since 2019. Amazon rejected the case as “misguided.”

The dispute centers on second-price auctions. Under that system, the winning advertiser normally pays one cent more than the best competing bid, rather than the full amount it offered. The complaint alleges that Amazon began introducing a fictitious competitor after a winner had been selected in late 2018, expanding the practice from July 2019.

secretly and systematically overcharged

— Federal Trade Commission and 22 statesThe complaint’s allegation about Amazon’s treatment of advertisers.

Regulators say the result was that winning advertisers paid their maximum bids in nearly 80% of cases in 2024. Internal documents cited in the complaint include an admission from the vice president overseeing advertising that Amazon had “inserted” a bid to adjust prices beyond what natural competition would produce. An analyst described the mechanism as an invented auction participant representing Amazon’s estimated value for the advertising space.

inserted

— Amazon advertising division vice presidentAn internal document cited by regulators describing how a bid was added to adjust prices.

The company has already faced two other major FTC cases. In September 2025, it agreed to pay $2.5 billion to settle allegations involving Prime subscriptions signed up without customers’ knowledge and difficult to cancel. A separate case accusing Amazon of illegally monopolizing online commerce is due to go to trial in the same court on March 29, 2027, and could lead to a restructuring of the company.

an invented auction participant, representing the value estimated by Amazon for that advertising space

— Amazon analystAn internal description of the alleged fictitious competitor used in the auction mechanism.
About this summary

Originally published by Le Temps in French. Translated, summarized, and contextualized automatically by DistantNews, with a note on how the source frames the story. Not individually reviewed before publishing. How this works.

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