UK Launches Inquiry Into Amazon and Anthropic Partnership

The UK Competition and Markets Authority (CMA) released a notice that it launched a phase 1 investigation into the partnership between Amazon and Anthropic.

The CMA now has until October 4 to provide an outcome of this first phase. This could go one of two ways: the CMA can decide that the partnership has no negative impact on competition in the UK or the CMA can decide to conduct a more detailed investigation in phase 2.

In April, the CMA initiated an invitation to comment on this partnership, as well as the one between Microsoft and Mistral AI. This allows any interested third party to “give their views on whether the partnerships… fall within UK merger rules and the impact that these arrangements could have on competition in the UK.” The invitation to comment closed in May.

The CMA raised concerns last year regarding risks to competition in the area of development of AI Foundation Models (FM). In particular, it is keeping an eye on which companies control the inputs for the development of FM, whether powerful tech companies are exploiting their position to restrict competition, and if partnerships are reinforcing market power in a limited number of tech leaders.

“Foundation Models have the potential to fundamentally impact the way we all live and work, including products and services across so many UK sectors – healthcare, energy, transport, finance and more,” said Joel Bamford, Executive Director of Mergers at the CMA. “So open, fair, and effective competition in Foundation Model markets is critical to making sure the full benefits of this transformation are realized by people and businesses in the UK.”

An Amazon spokesperson denied these claims and stated that Amazon’s partnership with Anthropic “does not raise any competition concerns or meet the CMA’s own threshold for review.”

“Our strategic partnerships and investor relationships do not diminish our corporate governance independence or our freedom to partner with others,” an Anthropic spokesperson said. “We intend to cooperate with the CMA and provide them with a comprehensive understanding of Amazon’s investment and our commercial collaboration.”

Amazon and Anthropic announced their partnership in September 2023. Amazon agreed to invest $4 billion in Anthropic, gaining a minority stake in the company, and Anthropic agreed to use Amazon as its main cloud provider.