Germany’s antitrust watchdog, the Federal Cartel Office, has issued a warning to Amazon Inc over its pricing practices for third-party sellers on its platform.

The regulator announced on Monday that it is investigating whether Amazon’s pricing systems restrict sellers from offering lower prices on other platforms, potentially distorting competition.

The President of the Cartel Office, Andreas Mundt, emphasized Amazon’s dominant role in Germany’s online retail sector, where it controls approximately 60% of the market.

“Since Amazon competes directly with other marketplace retailers on its platform, influencing competitors’ pricing, even in the form of price caps, is fundamentally questionable from a competition perspective,” Mundt said.

The regulator claims that Amazon uses undisclosed pricing algorithms to monitor and influence product prices on its platform.

According to Mundt, these mechanisms lack transparency.

When Amazon’s system detects that a product is priced too high, it may either remove the listing or prevent it from appearing in the prominent “Buy Box.”

The watchdog further explained that sellers are pressured to match Amazon’s algorithm-determined reference prices. If they fail to do so, their products may be pushed down in search rankings or excluded from advertising opportunities.

The regulator argues that Amazon’s price controls could drive sellers out of its marketplace and contribute to market concentration.

It added that it is working with the European Commission, the EU’s executive body, to enforce the rules under the Digital Markets Act.