Mexico Orders Amazon and Mercado Libre to Increase Market Transparency

Overview

• Mexican regulators have ordered Amazon and Mercado Libre to reveal their algorithms and separate TV streaming services from marketplace memberships to ensure fair competition.
• The Federal Commission on Economic Competition (COFECE) found that the two companies control 85% of online sales in Mexico, creating a lack of competitive conditions in the online retail market.
• COFECE's corrective measures include prohibiting Amazon from using its Prime Video streaming service as an incentive for Prime memberships and requiring transparency in how items are promoted on their platforms.
• Amazon has faced similar regulatory challenges in other countries, including a major agreement in Europe to end competition probes and an antitrust lawsuit in the U.S. filed by the Federal Trade Commission and 17 states.
• The companies can appeal the order, which, if not complied with, could result in fines up to 8% of a company's revenues in Mexico.