Amazon may lose its logistics business under US antitrust legislation

 Democrat Pramila Jayapal proposes company be barred from luring sellers to use its logistics services in exchange for preferential treatment on it web store.

Amazon.com Inc. could be forced to sell its valuable logistics services division -- the network of warehouses and delivery hubs around the country that power quick delivery of online orders -- under antitrust legislation proposed by a congresswoman from Amazon’s hometown of Seattle, according to a spokesman for the lawmaker.

Washington Democrat Pramila Jayapal has proposed a bill with bipartisan support that would prevent Amazon from luring sellers to use its logistics services in exchange for preferential treatment on its busy web store. Nearly 85% of Amazon’s biggest sellers use its Fulfillment by Amazon service, paying the online retailer fees for warehouse storage, packing and shipping of their products, according to a report last October from Democratic staff on the House Judiciary Committee’s antitrust panel.

Jayapal’s bill was introduced on June 11 and will be considered on Wednesday by the Judiciary Committee along with five other bipartisan antitrust reform bills, with votes to advance the measures to the House floor expected this week. There’s no Senate companion for the legislation, and support in that chamber is unclear, clouding its prospects.

While the bill may never become law, it’s the clearest indication yet how lawmakers are gunning to rein in the market power of Amazon, where U.S. shoppers will spend $386 billion this year and which captures 41 cents of every dollar spent online, according to EMarketer Inc. Amazon’s promise of fast delivery helped it become the dominant online retailer in the U.S.

Amazon’s logistics business will be worth as much as $230 billion in 2025, more than Coca-Cola Co., according to a research note last year from Bank of America Corp.

The bipartisan Ending Platform Monopolies Act requires dominant platforms including Amazon to divest lines of business -- such as Fulfillment by Amazon -- where the platform’s gatekeeper power allows it to favor its own services,” said Jayapal spokesman Chris Evans. “Numerous third-party sellers reported feeling that they had no choice but to pay for Fulfillment by Amazon in order to sell their products,” said Evans, referring to the House Democrats’ investigation and report.