EU antitrust regulators say Amazon’s iRobot deal may restrict competition

BRUSSELS (Reuters): EU antitrust regulators said on Monday Amazon’s (AMZN.O) $1.4 billion acquisition of robot vacuum maker iRobot (IRBT.O) may squeeze out rival robot cleaners on its online marketplace.

Amazon announced the deal in August last year amid increased regulatory scrutiny around the world of Big Tech acquiring smaller rivals and accumulating troves of data that could boost their market dominance or help them expand into other markets.

“Amazon may have the ability and the incentive to foreclose iRobot’s rivals by engaging in several foreclosing strategies aimed at preventing rivals from selling RVCs on Amazon’s online marketplace and/or at degrading their access to it,” the European Commission said in a statement.

The EU competition enforcer said Amazon’s online marketplace is an important channel for robot vacuum cleaners (RVCs) in France, Germany, Italy and Spain.

It sent a statement of objections to the company detailing its concerns. While such a charge sheet puts pressure on companies to offer remedies, they also give companies the chance to better address specific issues and even secure unconditional clearance.

Amazon said it was working with the Commission to address its concerns.

“iRobot, which faces intense competition from other vacuum cleaner suppliers, offers practical and inventive products. We believe Amazon can offer a company like iRobot the resources to accelerate innovation and invest in critical features while lowering prices for consumers,” the company said.

Amazon can request a closed door hearing to argue its case.

Reuters reported last week that the deal would win unconditional clearance. The Commission’s deadline for a decision is Feb. 14.