A £1 billion pound damages claim will be filed today against Amazon on behalf of retailers selling on Amazon’s UK marketplace for illegally misusing their data and manipulating the Amazon Buy Box to benefit its own commercial operation and its overall revenues and profit.
The claim, the biggest collective action ever launched by UK retailers, is being brought by the British Independent Retailers Association (BIRA) on behalf of retailers at the Competition Appeal Tribunal (CAT) in London. It asserts that between October 2015 and the present date, Amazon used data belonging to UK retailers on the company’s marketplace – data that is non-public and belongs solely and specifically to the retailers – in combination with manipulating the Amazon Buy Box, to engage in a product entry strategy that resulted in sales revenue and profits being diverted from these retailers to Amazon.
Such commercially valuable and confidential information helps Amazon decide whether to enter a new product segment based on its earnings and sales potential, which elements of the product to copy, how to price an item, and which consumers to target. That information in combination with the Buy Box, meant Amazon knew it could successfully enter and take away profits from UK retailers.
The retailers, many of whom are small independent UK businesses, were unaware that Amazon was illegally using their data to benefit its own retail operation. Amazon was already charging them a non-negotiable 30 per cent commission on every product sold on the site. By misusing their proprietary data to bring to market rival products that are sold cheaper, Amazon is effectively pushing many of the UK’s independent retailers out of the market. The consequences of Amazon’s abusive conduct has been to inflate its profits and harm the UK retail sector, especially the smaller independent retailers who are struggling at a time of difficult economic circumstances.
It is the largest collective claim to be filed under the Competition Act 1998 on behalf of UK retailers. The Act was amended in 2015 to enable a collective damages claim to be brought on behalf of a class of people who have suffered loss.
Amazon has long challenged the suggestion that when it makes and sells its own products, it misuses the information it collects from the marketplace’s third-party retailers. It has similarly challenged that it uses the Buy Box to preference its own retail operations.
However, in 2022 the UK Competition and Markets Authority (CMA) opened a probe into Amazon alleging it was abusing its dominant market position by giving an unfair advantage to its own retail business and retailers that use its services over other third-party retailers on its marketplace. The UK is Amazon’s biggest European market. The CMA raised concerns that Amazon’s access to ‘commercially sensitive data’ relating to third-party retailers could give it an advantage in deciding which products to sell and how to set prices.
The competition watchdog also alleged that products sold by third-party retailers were less likely to appear in the "Buy Box" than Amazon’s own products, reinforcing the anticompetitive effect of Amazon’s decisions to take sales away from third-party retailers. Amazon set itself up through these unlawful practices to maximise the profit it would make and, in doing so, it must have known about the damage it would cause to third-party retailers.
In order to avoid a full investigation and detailed decision from the CMA about its conduct, Amazon offered a number of commitments to halt these practices. It also agreed to appoint an independent trustee, approved by the CMA, to monitor the company’s compliance with its commitments going forward. There has been a similar investigation by the European Commission which yielded similar concessions from Amazon.
Amazon’s annual gross profit for 2023 was $270.046bn [£211.46bn], a 19.94 per cent increase from 2022.
Today’s filing of a collective action against Amazon will allow UK retailers to access justice as a group and receive compensation for the losses they have incurred as a result of Amazon’s unlawful conduct.
Based on expert analysis of the evidence, the total damage caused to UK retailers is estimated to be in the region of £1.1bn including interest.
The claim is being brought by the BIRA, as the proposed representative of the class of retailers selling on the UK marketplace that have suffered loss. BIRA is 'the voice of independent retailers' and their leading trade association in the UK. BIRA also chairs the Independent Retailer Confederation (IRC), an informal group of approximately 20 other small retail associations.
BIRA’s Chief Executive Andrew Goodacre has worked hard for several years to strengthen Britain’s independent retailers and the communities they support.
BIRA will today file over 1,150 pages of documents with the CAT that set out the claim against Amazon. This includes a statement from Mr Goodacre explaining why BIRA is bringing the action and how it will manage the claim on behalf of the proposed class of retailers. There is also a report from a leading independent economic expert that supports the claim and a detailed plan for managing the claim, including how the proposed class of approximately 35,000 UK retailers will be communicated with through a claim website, newspapers, magazines and social media.
Andrew Goodacre said, “One might ask why would an independent retailer use Amazon if it is so damaging to their business? In reality, we have seen a significant shift in consumer buying behaviour and, if small business want to sell online, Amazon is the dominant marketplace in the UK. As a result, for small retailers with limited resources, Amazon is the marketplace to start online trading. Whilst the retailers knew about the large commissions charged by Amazon, they did not know about the added risk of their trading data being used by Amazon to take sales away from them.”
Goodacre added, “The British public has a strong relationship with its local, independent retailers and ensuring they are not put out of business by Amazon’s illegal actions is a key driving force behind this collective action. The filing of the claim today is the first step towards retailers obtaining compensation for what Amazon has done. I am confident that the CAT will authorise the claim to go forward, and I look forward to the opportunity to present the case on behalf of UK retailers. This is a watershed moment for UK retailers, but especially for small independent retailers in this country.”
BIRA has instructed leading international law firm Willkie Farr & Gallagher (UK) LLP on this landmark case. Their team is being led by partners Boris Bronfentrinker, Elaine Whiteford and Michelle Clark. Leading competition barristers Sarah Ford KC at Brick Court Chambers and Jason Pobjoy from Blackstone Chambers have also been instructed, whilst BIRA’s independent economic expert is Dr Rainer Nitsche from E.CA Economics.
Boris Bronfentrinker said, “This is precisely the sort of claim that the new collective action regime was brought in for, to enable small and medium size businesses to be able to recover damages caused to them by a huge multinational, where they would not otherwise have such access to justice. The power of Amazon is unrivalled when it comes to the very important online world to which so much commerce has migrated. Making itself a must use for retailers, Amazon has then proceeded to cause damage and financial loss to retailers by misusing their confidential data that Amazon was entrusted to keep safe and by preferencing its own retail operations.
"No individual retailer, no matter how large, is willing to get into the lion’s den and take the fight to Amazon, but fortunately BIRA has shown that it will stand up and fight for UK retailers, backed with the financial muscle of one of the world’s largest litigation funders, and with a first-class team of advisors. Retailers in the UK were entitled to be treated better and fairly by Amazon. They were not, and this claim will deliver back to them the more than a billion pounds in damages that has been caused to them. We are honoured that BIRA has entrusted us to bring such an important claim on behalf of retailers in the UK.”
Under the rules laid down in the Competition Act 1998, all UK retailers who have lost out and are now domiciled in the UK will automatically become part of the claimant class unless they explicitly opt-out. This means that, once the claim is filed, no action will be required by individual retailers as they will automatically be eligible to receive compensation at the conclusion of the claim. Those not currently domiciled in the UK, but who sold on the UK marketplace, will have the opportunity to opt-in and get the benefits of the proposed claim.
Litigation Capital Management (LCM), one of the world’s largest litigation funders, will fund the claim, partnering with Goodacre and Willkie to see this action through to the end. Everything is in place to get the best possible result for UK retailers and ensure that Amazon is made to pay for its unlawful and harmful conduct.
Following the initial response condemning the Budget as 'the most damaging for independent retailers in recent memory' from the British Independent Retailers Association (Bira), members have shared their stark reactions to the triple burden of doubled business rates, increased National Insurance, and higher minimum wage costs.
Multiple retailers have calculated specific impacts on their businesses, with costs ranging from £90,000 to £150,000 per year.
"This budget was horrendous for us as a company. Estimated costs to be around £110,000 - £120,000 per year," said Andrew Massey of Masseys DIY in Swadlincote, Derbyshire.
The immediate impact on employment is already evident. Peter Massey of R Massey & Son Ltd, employing 38 staff, said: "We decided last night that we will not replace the next two members of staff that leave. We are also considering what to do with our coffee shop that employs quite a few youngsters."
Kevin Arthur of Pewsey RadioVision in Wiltshire highlighted the broader staffing implications: "The minimum wage rising to £25.5k per year (40hr week) is scandalous. Having to pay this type of salary for your most basic of employees will mean less employees, resentment amongst 'more valuable' staff who believe they are 'worth' far more than a basic employee, and less ability to pay staff bonuses. I am now looking to reduce staff hours, reduce staff numbers, and Christmas bonuses will be curtailed and any other 'perks' reduced."
A store owner in the South West, whose business has traded for over a century, revealed: "Prior to the budget we were looking at taking on a new store and creating 12 new jobs. The colossal impact that Labour has imposed on our business means that not only will this new store not happen, but we will be reviewing our sites and having to make redundancies in order to survive."
William Coe, of Coes in Ipswich, highlighted the challenge facing customer-focused businesses: "We all want the same thing – Growth – however for growth businesses need to make a profit to enable them to invest. With the cost rises put upon them yesterday this gets harder and harder especially for the retail and leisure sectors where the ability to make savings through technology is limited."
John Jones, Managing Partner of Philip Morris Direct in Hereford, warned: "We've been saying for months that the issue for small business is the cumulative effect of so many extra costs. These add up to a level of costs that just aren't sustainable, and I fear there will be a blood bath of small business on the high street."
The impact threatens the very existence of some long-established businesses.
A West Midlands clothing retailer with over 100 years of trading history confirmed they are "closing the doors in the near future," adding that "the cumulative effect of the rate hike, NI increase and the Minimum Living Wage increases mean that already emptying towns will become wastelands."
For smaller independents, the situation is particularly acute. Tracey Clark of Albert's Hardware in Somerset revealed: "I work in excess of 70 hrs a week with little to no personal financial gain. I can't see myself surviving the next six months."
The disparity between high street retailers and online competition was highlighted by several members, with concerns raised about UK-based businesses bearing the cost burden while international competitors selling cheap imported clothing operate with minimal tax liability.
A Greater Manchester fashion retailer emphasised the disconnect between policy makers and small business reality: "They are completely detached from reality. They need someone advising that has lived and breathed a small business. There should at least have been a threshold where businesses below a certain turnover aren't hit by these things."
The impact extends beyond retail to related sectors.
A West Midlands builders' merchant warned of broader economic consequences. The owner said: "The Government has put the boot in to small business. We are paying for everything. Farmers are in real trouble now and the economy will suffer. They went round telling businesses rates were unfair and would sort it out, then just put them up. They lied to us all and now jobs will go and inflation will rise."
Many retailers expressed frustration at what they see as broken promises. A Birmingham-based jewellery store owner said: "High Streets are the cash cow for Governments and when most have disappeared, they will scratch their heads and wonder why."
The combined impact of these measures threatens not just individual businesses but entire local economies. With many retailers already reporting worse trading conditions - Bira's recent survey showed 46% reported worse trading in early 2024 compared to 2023 - these additional costs could prove the final straw for many independent businesses.
Andrew Goodacre, CEO of Bira said: "For some, the Budget has forced immediate operational decisions. Several retailers mentioned reviewing staffing levels, reconsidering expansion plans, and in some cases, accelerating closure plans. The impact on future generations is particularly concerning, with multiple family businesses questioning their long-term viability."
A Midlands hardware store owner summed up the common challenge: "This will make trading near impossible with wage increases and the business rates, and no one wants to pay any more for goods."
Brocks at Rockwell Green, a Premier-branded convenience store near Wellington, Somerset is on the market as owners Simon and Rachel Brock are now looking to retire - after running the store for nearly 25 years.
Selling a wide range of products and everyday essentials, the store is “well-established and popular” among both the local communities.
“It has been a pleasure running the store for the last 23 years and serving the local community. It has been a tough decision to sell but we felt now was the best time to retire,” Simon said.
Specialist business property adviser Christie & Co has been instructed to market the property, which also features a variety of storage spaces, offices and independently accessed three-bedroom accommodation.
Matthew McFarlane, business agent at Christie & Co who is managing the sale, commented: “This is a fabulous store and property, offering a large sales area, great storeroom and residential accommodation. The sales figures are very strong which represents an excellent opportunity for corporate buyers or established multi operators.”
Wrexham Lager Beer Co Ltd, the oldest lager brewery still existing in Britain that has been brewing in Wales since 1882, has announced Rob McElhenney and Ryan Reynolds as new co-owners of the company alongside the Roberts family.
The acquisition was made by Red Dragon Ventures, a joint venture formed by The R.R. McReynolds Company, majority owner of Wrexham AFC, and the Allyn family of Skaneateles, New York. Red Dragon Ventures was created to drive growth in the Wrexham community and Wrexham AFC.
This transaction represents another landmark deal for the Welsh town and will considerably scale up Wrexham Lager’s infrastructure and international production, distribution, and marketing efforts.
“As co-chairmen of Wrexham AFC we have learned a lot,” said Rob McElhenney and Ryan Reynolds. “The connection between club and community, the intricacies of the offsides rule and the occasional need for beer – especially after finance meetings. Wrexham Lager has a 140-year-old recipe and a storied history and we’re excited to help write its next chapter.”
The Roberts family, who have owned and operated the business since 2011, will maintain an active role within the business, continuing to oversee quality control across all markets, local brewery operations, and community engagement projects.
Recently appointed chief executive James Wright will continue to lead the business after already overseeing rapid UK growth, as well as international expansion into Australia, Japan, and Scandinavia. Distribution in the US and Canada is set to go live in the coming months.
“This is a brand with great heritage – the oldest lager brewery in Great Britain, once enjoyed across the world,” Wright said. “So, to have Rob and Ryan onboard as we embark on international expansion is huge for us. They have been doing wonders for the town of Wrexham and strongly share our passion for once again seeing Wrexham Lager enjoyed in all the far-flung corners of the globe.”
Wrexham Lager Beer Co currently produces the 4% ABV Wrexham Lager, 5% ABV Wrexham Lager Export, and recently introduced 4.6% ABV Pilsener. The 4% Wrexham Lager is produced using an original recipe from 140 years ago that was once available in the world-famous Harrods luxury department store in London, as well as chosen as the only lager to be served on the White Star Line’s Titanic.
Ten global beverage companies have joined forces under a new industry-wide consortium, called REfresh Alliance, which is designed to help accelerate renewable energy adoption across the industry’s supply chain.
The new initiative invites additional companies from across the beverage industry to pool and scale their resources to remove barriers to renewable energy adoption in the supply chain, provide education on best market practices and support the industry’s transition to Net Zero.
Companies currently part of the REfresh Alliance include: Bacardi, Carlsberg Group, Constellation Brands, Diageo, Heineken, Molson Coors Beverage Company, Pernod Ricard, The Coca-Cola Company and Whyte & Mackay.
The programme is managed by leading energy solution provider, Enel X. Through its Advisory Services division, Enel X connects the participants with renewable energy providers and supports renewable energy transactions, aiming to accelerate renewable energy adoption.
The programe also features a dedicated educational platform to help program participants prepare for renewable energy adoption.
Scope 3 emissions, which are not directly produced by a company but from its supply chain, often account for approximately 90 per cent of a beverage company’s carbon footprint. As suppliers continue to face a number of barriers to decarbonisation, REfresh has already engaged with more than 300 suppliers to discuss their involvement in the programme as it aims to support their adoption of renewable energy solutions.
“We have long recognised the need for industry collaboration to deliver the most impact and to accelerate the transition across our supply chains,” Ralf Peters, chief procurement officer of Coca-Cola Europacific Partners (CCEP), and chairman, Coca-Cola Cross Enterprise Procurement Group (CEPG), said.
“I know from my experience across the Coca-Cola system that supporting our supply partners is a key part of our sustainability action – and that encouraging them to transition to renewables is one of the most impactful things we can do to help decarbonise their businesses, and to do the same in ours.”
Hervé Le Faou, chief procurement officer of Heineken, said: “Scope 3 emissions are one of the biggest challenges that the industry faces in delivering on our Net Zero ambitions. We must work together to identify areas of our supply chains where we can pool our resources to accelerate this transition for our suppliers. We look forward to working with other beverage companies to achieve this and accelerate the decarbonization of our industry.”
Jane Liang, chief procurement officer of Diageo, said: “The climate crisis is the most pressing issue of our time and the transition to Net Zero is becoming increasingly important. However, there is only so much we can do as individual businesses. The REfresh Alliance will drive collective action within the industry to accelerate the adoption of renewable energy. We are calling on all companies and suppliers within the industry to join us and support the industry in its transition to Net Zero.”
REfresh intends to initially launch in the mature renewable energy markets of Europe and North America, where it will be able to use existing networks to accelerate impact in support of the industry’s decarbonization efforts. As it continues to grow, the consortium will look to expand to other markets and welcome businesses from across the beverage industry to join it in supporting suppliers in their decarbonization journeys.
Keep ReadingShow less
Single-use disposable vapes are displayed for sale on October 27, 2024 in London, England
Vape industry bodies have raised concerns over chancellor Rachel Reeves’ budget announcement introducing a flat-rate excise duty on vaping products, saying it could hurt public health and increase financial pressures on consumers.
The new excise tax, set to begin on October 1, 2026, will add £2.20 per 10ml of vaping liquid, with additional VAT. This rate replaces the previous government’s proposed tiered tax structure, which many in the industry had criticised.
The Independent British Vape Trade Association (IBVTA) welcomed the shift from a tiered structure but voiced strong concerns about the overall impact on vapers, particularly those on lower incomes.
“The government has already proposed regulation that will ban single use products, which despite helping many adult smokers access vaping, have via irresponsible retailers been disproportionately accessible to children,” said IBVTA chair Marcus Saxton.
“It would seem a little questionable then to increase the cost of vaping, especially given there are still around six million adult smokers for who you’re trying to give every opportunity to make the transition to less harmful products.”
Saxton warned that higher costs could hinder the progress made by public services utilising vapes within their smoking cessation services, adding, “The IBVTA do not believe that any excise tax should be applied to products supplied via these services.”
The UK Vaping Industry Association (UKVIA) voiced even sharper criticism, highlighting the potential for the new excise tax to become an economic burden on adult vapers.
John Dunne, UKVIA’s director general, noted that the additional £2.64 per 10ml of e-liquid (inclusive of VAT) could result in a 267 per cent price hike for some e-liquids, a change that he described as “a kick in the teeth for former adult smokers who have switched to vaping to quit their habits.”
Dunne cautioned that the new excise rate would be “the highest in Europe,” and warned that it could deter adult smokers from considering vapes as a smoking cessation tool.
“Some 3 million adults are former smokers thanks to vaping, which is strongly evidenced as the most effective way to quit conventional cigarettes, saving the NHS millions of pounds in treating patients with smoking related conditions. This announcement today deters adult smokers from considering vapes as a method to give up their habits, and hits the lowest paid,” said Dunne.
He criticised the government’s approach, calling it a “revenue grab from former smokers” and noted the inconsistency with reduced VAT rates applied to other nicotine replacement therapies.
“It would also make more sense for vapes to be taxed at a lower VAT rate, which is the case for other nicotine replacement therapies, which have proven to be considerably less successful than vapes in helping smokers quit,” he said.
The budget also announced a consultation on new compliance measures, including vaping duty stamps and supply chain controls to combat illicit production of nicotine products. This consultation, open until December 11, 2024, aims to limit illegal manufacturing while ensuring the new duty’s effective enforcement.