Amazon gets biggest ever EU fine over data violations

The retailer needs to settle €746m

Amazon is currently in a hot seat after the European Union privacy agency decided to file a lawsuit against the giant retailer for allegedly illegal user personal data collection activities. As a result, now the company faces the biggest ever EU privacy fine.

As reported by Bloomberg, CNPD, the Luxembourg data protection authority slapped Amazon with the record fine of $888m (€746m) in a 16 July decision that accused the online retailer of processing personal data in violation of the EU’s General Data Protection Regulation, or GDPR. Amazon disclosed the findings in a regulatory filing on Friday, saying the decision is “without merit.”

 “There has been no data breach, and no customer data has been exposed to any third party,” Amazon said in a statement, adding that it plans to appeal. “These facts are undisputed. We strongly disagree with the CNPD’s ruling.”

The decision concludes a probe started by a 2018 complaint from French privacy rights group La Quadrature du Net. It cautiously welcomed the decision.

“It’s a first step to see a fine that’s dissuasive, but we need to remain vigilant and see if the decision also includes an injunction to correct the infringing behavior,” said Bastien Le Querrec, a member of La Quadrature’s litigation team, adding the group hadn’t received the decision.

EU data protection regulators’ powers have increased significantly since the bloc’s GDPR rules took effect in May 2018. It allows watchdogs for the first time to levy fines of as much as 4% of a company’s annual global sales. The biggest fine to date was the €50m penalty for Google issued by France’s CNIL.

The company has drawn scrutiny in recent years for the vast trove of data it has amassed on a range of customers and partners, including independent merchants who sell on its retail marketplace, users of its Alexa digital assistant, and shoppers whose browsing and purchase history inform what Amazon shows them on its website.

The company says it collects data to improve the customer experience and sets guidelines governing what employees can do with it. Some lawmakers and regulators, however, have raised concerns that the company has used what it knows to give itself an unfair advantage in the marketplace.

The privacy probe also adds to intense antitrust scrutiny of Amazon’s business in Europe. Amazon is being probed by the EU over its use of data from sellers on its platform and whether it unfairly favors its own products. Germany has multiple probes into Amazon’s sales. The UK is also examining similar issues to the EU.

The European Commission last month also said it sees potential antitrust problems with voice assistants and the data they allow Amazon and others to collect on user behavior.

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