The Italian Competition Authority (AGCM) has fined Apple and Amazon a combined total of €203.2 million (US$228 million) after an antitrust investigation involving the reselling of Beats products. According to the watchdog, the two companies signed an agreement in 2018 that would prohibit both official and unofficial resellers of Apple and Apple-owned Beats products on Amazon’s Italian website. That agreement allegedly contained contractual clauses that only allowed Amazon itself and select sellers “chosen individually and in a discriminatory way” to sell those items.

AGCM said in its announcement that those clauses violate article 101 of the Treaty on the Functioning of the European Union. In addition, the watchdog said the agreement restricted cross-border sales, ultimately limiting buyers’ options and depriving them of the discounts typically offered by third-party sellers. The Italian authority opened the antitrust case against both companies in 2020 and even searched their offices in the country. 

A total of 70 percent of consumer electronics purchases in the country are from Amazon, AGCM explained, and 40 percent were purchases from sellers that use the website as their main platform. That’s why it’s essential for Amazon to implement Italy’s competition rules and ensure a level playing field for all sellers, as well as to ensure that buyers have access to more options.

AGCM imposed a fine of €68.7 million (US$77 million) on Amazon and a fine of €134.5 million (US$151.2 million) on Apple. It also ordered the companies to end the restrictions and allow the sale of Apple and Beats products on Amazon Italy in “non-discriminatory manner.” In a statement sent to Reuters, Amazon called the imposed penalty “disproportionate and unjustified.” A spokesperson said in a statement:

“We reject the suggestion that Amazon benefits by excluding sellers from our store, since our business model relies on their success. As a result of the agreement, Italian customers can find the latest Apple and Beats products on our store, benefiting from a catalogue that more than doubled, with better deals and faster shipping.”

Meanwhile, Apple denied any wrongdoing:

“To ensure our customers purchase genuine products, we work closely with our reseller partners and have dedicated teams of experts around the world who work with law enforcement, customs and merchants to ensure only genuine Apple products are being sold.”

According to Reuters, both companies are planning to appeal the watchdog’s penalty.