Privacy International granted interested third party status in European Commission’s review of Amazon/iRobot merger
A legal and technical analysis of the data impacts of the merger carried out by Privacy International (PI) suggests that the merger would threaten competition in and across several potential markets. In its submissions to the European Commission (EC), which granted it interested third party status in the merger review, PI urges the EC to apply close scrutiny to the transaction, warning about Amazon's potential use of iRobot’s data troves to cement its dominance and the resulting degradation of consumers' privacy options. Hausfeld is supporting PI in its intervention before the Commission.
Background
In August 2022, Amazon announced that they had entered into a definitive merger agreement to acquire iRobot, a company specialising in consumer robots like the Roomba vacuum cleaners.
iRobot is a technology company headquartered in the United States that specialises in designing and building consumer robots. Its portfolio includes a variety of autonomous ‘smart home’ devices, such as vacuum cleaners (Roomba), floor moppers (Braava), and other autonomous cleaning devices which use Artificial Intelligence, online/offline user interactions and date gathered through sensors.
The European Commission was formally notified of the transaction on 1 June 2023. The merger was also notified in the US, and the FTC’s investigation is ongoing.
The CMA commenced an investigation of its own volition in April 2023 and recently cleared the merger in the UK.
Concerns
In its submissions to the EC, which mirror the comments previously submitted to the CMA, PI highlights that whilst the starting point for the competitive assessment is the state of static competition in the relevant markets, the proposed acquisition requires a broader analysis of potential and dynamic competition which arise where businesses engage in a fluid competitive process which revolves around innovation across more than one, connected, market.
With that in mind, PI’s analysis of the data impacts of the transaction indicates that it would threaten competition in and across several potential markets including, without limitation: (i) the market for smart home devices, (ii) the market for online retail, including intermediation services, and (iii) the market for digital advertising services.
More generally, PI believes that the acquisition of iRobot would reduce what little pressure there currently is on Amazon to compete in relation to privacy options available to consumers, leading to even less competition on privacy standards and thereby enabling the further degradation of consumers’ privacy protections.
What's next?
PI has been now granted interested third party status by the EC in its capacity as an organisation seeking to promote consumers’ rights and to defend their privacy, and in light of its track record of successful engagement with the EC on matters concerning the intersection of privacy/data and competition law. A such, PI will have the right to be heard as part of the EC procedure.
About Privacy International
PI is a leading non-profit, non-governmental organisation, based in London, which campaigns globally against abuses of data and technology. PI employs specialists in their fields, including technologists and lawyers, to understand the impact of existing and emerging technology upon data exploitation and our right to privacy, including in relation to online platforms and the advertising technology industry. PI has an established track record of effective and helpful engagement with competition regulators around the world on issues that concern the intersection of data privacy and competition laws.
