Feeling pressure, Amazon ramps up its EU lobbying

Amazon, a giant sprawling across the EU

Amazon is one of the world’s biggest and most powerful companies, worth(opens in new window) over USD1.49 trillion. First and foremost, the company is known as an online shop, yet that is just half of the story. Its business is made up of a series of different services ranging from the classic online retail to logistics services for other sellers (Fulfilment by Amazon),(opens in new window) connected devices(opens in new window) including the personal assistant Alexa, social media and video streaming via Twitch(opens in new window) and Amazon Prime Video(opens in new window) , cloud storage and software as a service (SaaS) via Amazon Web Services,(opens in new window) a digital advertising(opens in new window) platform, and satellite-based global broadband provider via Kuiper(opens in new window) , set to involve 3,236 satellites in low orbit around the earth.

For the past 25 years, the company has built a complex network of logistics, data centres, and corporate offices across Europe.

According to the company’s EU Store Transparency report, its online stores record an estimated average of 181 million monthly users across the EU. That is 40 per cent of the population in the union. By comparison, its nearest competitor, eBay(opens in new window) , doesn’t even reach the 45 million users threshold.

For a review of Amazon’s e-commerce power in Europe and a breakdown of its European revenue, read Amazon’s European Chokehold.

While incredibly lucrative, Amazon’s sprawling business model relies on a series of practices that have come under criticism and started to become the target of regulation. For instance, its marketplace has been investigated, fined, and sued in several jurisdictions due to abuses of market power; workers in Germany(opens in new window) and Italy(opens in new window) have taken collective action over labour conditions and low pay;  its data collection and processing practices have also come under fire for breaching(opens in new window) EU data protection laws; and, local communities and workers have questioned the sustainability impact of the company’s operations, from the environmental impact(opens in new window) of its logistics centres to the company’s carbon footprint(opens in new window) .

At the same time, the EU has been mulling over a set of new rules on platform governance(opens in new window) , tax policy(opens in new window) , and climate change(opens in new window) , which could impact how Amazon makes money and maintains its monopoly power.

As a response, the company has ramped up its lobbying efforts. To read the full analysis of Amazon’s lobbying strategy, read Amazon’s lobbying satellites orbit EU policy-makers(opens in new window) . 

Amazon, a lobbying powerhouse

By looking at the company’s EU lobby disclosures, Corporate Europe Observatory, LobbyControl and SOMO have found that:

• Amazon has been building up its EU lobbying presence.

Since 2020, the company has substantially increased its EU lobbying budget, peaking in 2021 at €3 million. The spending diminished slightly in 2022, but Amazon is still in the top 14 biggest lobby spenders for a single company.  

Data(opens in new window) on meetings with high-level EU officials shows that the company’s lobbying mainly targets digital policy (data protection and US-EU data transfers; online safety, adtech transparency and digital monopoly rules); the European Green Deal, including plans to make consumption and transport more sustainable; to employment issues such as social dialogue.

• Amazon’s subsidiaries and associate companies are also active at EU level

Twitch(opens in new window) , Twilio(opens in new window) and Deliveroo(opens in new window) spent a combined €425,000 lobbying the EU Institutions on various platform regulation bills (e.g. Digital Services Act and Digital Markets Act), the Artificial Intelligence Act, the Data Act, and the Platform Workers Directive.

• Amazon also lobbies EU national governments

At the same time, Amazon has also expanded its lobbying at the national level. In Germany and France – its two biggest EU markets – the company spent a combined €3.6 million in 2022. This is higher than its declared spending at the EU level and indicates the company prioritises national-level lobbying.

In Germany, Amazon and its subsidiaries (AWS and Twitch) spent(opens in new window) more than €2,400,000 in 2022. In France, Amazon(opens in new window) and Amazon Web Services (AWS)(opens in new window) spent at least €1.2 million lobbying in 2022, a 1,100 per cent increase from 2017, when it first started disclosing the figures.

This is only the tip of the iceberg. Lack of transparency or comparable information across the EU makes it impossible to map the lobby activities of a company like Amazon fully. In Ireland, for instance, the company has been very active, but the country’s transparency declarations do not force the company to disclose its lobbying budget.

Such national-level lobbying often targets national policy; however, the company also lobbies in EU capitals to influence the government’s position in the Council.

• Amazon hires thirteen lobby consultancies to help its EU lobbying efforts

In the past two years, Amazon has vastly increased the number of lobby firms working on its behalf. In 2022, it disclosed it had hired 13 lobby firms, accounting for 77 per cent of its total lobbying budget. For some issues, Amazon had multiple lobby firms.

The lobby firms that declare having worked for Amazon in the closed financial year registered 69 lobbying topics. Various lobby consultancies worked on the same policy issues. For instance, Amazon hired four different lobby firms to work on General Product Safety Regulation (GPSR) (Concilius AG, FTI Consulting, Hanbury, Kreab).

• Amazon’s message is amplified by a growing network of third-party groups

Since 2021, Amazon has also ramped up its network of third-party organisations: it now declares funding over 60 business associations, 15 think tanks and forums. Still, disclosure is not complete, as we have found two more think tanks that are funded by Amazon but are not listed in the company’s declarations: the Centre for European Policy Studies (CEPS) and the Centre for European Reform (CER)(opens in new window) .

Amazon also sponsors ACT – the App Association(opens in new window) , SME Connect and Allied for Startups(opens in new window) . All three of these have been criticised by policymakers(opens in new window) or former employees(opens in new window) for receiving extensive funding from big tech companies and taking policy positions that echo their funders’.

In 2020, leaked lobbying memos from Amazon seen by Politico Europe(opens in new window) revealed the importance of business associations for the company. The memo described (opens in new window) the company’s strategy to influence the ePrivacy Directive, which included “channelling its positions through a range of different lobby groups including tech groups CCIA and DigitalEurope, as well as marketing group FEDMA.” First proposed (opens in new window) in 2017, the EU Institutions have still not been able to finish (opens in new window) the ePrivacy file, at least in part due to opposition from corporate lobbying(opens in new window) .

• Against increased competition scrutiny, Amazon turns to economic consultancies and university funding

To influence EU competition and merger decisions, Amazon is a client of key economic consultancies such as Charles River Associations (CRAI) and Compass Lexecon.

CRAI’s services have gone beyond representing Amazon in mergers and antitrust cases. It has also tried to shape the public and academic debate about Amazon’s monopoly power. For example, Amazon funded a paper written by a consultant of CRAI and an academic from the University of Toronto. The authors argue against the EU and Italian investigations into Amazon’s abuses towards the third-party sellers on its platform. The authors state they want to “include Amazon’s perspective” in the public debate.

Amazon also funds(opens in new window) one of the most important competition schools in Europe, the Toulouse School of Economics (TSE). According to TSE’s website, this funding “enables partners to build a privileged relationship with a team of researchers”. This funding also offers unique lobbying and networking opportunities at public events.(opens in new window)

TSE is not the only school with a programme in competition economics receiving funding from Amazon. Also, the Florence Competition Programme, part of the European University Institute, counts Amazon as one of its major donors(opens in new window) .

• To counter negative public perception, Amazon launches public relations campaigns

Amazon launched a public relations campaign to face growing criticism of its labour practices, environmental impact and abuses of power. In France, for instance, the company has launched Operation ‘Ratatouille’, named after the Disney movie, to improve its public image. According to Bloomberg, this operation would include a series of TV ads, promotion of French products and commissioning of studies to show the company’s positive impact.

According to Lobbycontrol’s research,(opens in new window) Amazon also ran print ads worth €8.1 million (gross advertising costs) in 2021 to improve its image. It invested even more into TV ads in 2022 when it ran an advert in Germany and Austria worth €19 million that tells the story of a happy Amazon employee working on renewable energy for Amazon logistic centres.

In response to these research findings, an Amazon spokesperson told us: We [Amazon] advocate on a range of issues that are important to our customers, sellers, and the diverse range of businesses we operate. This means we work with organisations like trade associations and think tanks and communicate with officials at the European Institutions. We regularly update our entry in the EU Transparency Register in line with the guidelines.”

In the Profit Paradox: How Thriving Firms Threaten the Future of Work(opens in new window) , economist Jan Eeckhout describes a vicious cycle that connects firms’ market power and political power: 

Firms with market power have the resources to lobby politicians, and they use the lobbying to build larger uncontested empires, which in turn frees up more resources to lobby even further. For the economist, lobbying is the main vehicle to create and perpetuate market power.

Recent research(opens in new window) indicates that companies with market power spend more resources lobbying.

Perhaps even more importantly, the small businesses, workers and communities impacted by Amazon’s power are unlikely ever to be able to spend the same amount of resources to influence political processes.

This market and lobby power mix can be toxic to the democratic process. To stop it, SOMO, LobbyControl and Corporate Europe Observatory urge EU and national level policy-makers and regulators to:

• Implement safeguards for the democratic process, such as lobby transparency and ethics rules;
• Actively challenge the influence of well-resourced lobbyists and proactively seek under-resources civil society actors, such as unions, small businesses and environmental organisations;
• Fight excessive market power concentration. To adequately balance the democratic process, policymakers need to tackle market power. That will require upgrading and improving the enforcement of the EU’s antitrust rules;
• Whereas the Digital Markets Act (DMA) is a great step forward to challenge market power abuses, more needs to be done to fix Amazon’s power, including using structural remedies such as break-ups and merger control to prevent further power consolidation.