‘Amazon Amendment’ could put billions in federal spending onto e-commerce giant’s platform

As Amazon expands its marketplace for businesses, it’s on the verge of being handed the “Holy Grail” — to be platform of choice for the transactions that make up the federal government’s $53 procurement of commercial items, a new report said.

This would be accomplished as a result of language buried in a version of the National Defense Authorization Act that’s been passed by the House and is now being wrangled over in the Senate, according to the report.

The act as presently written shifts Defense Department purchases of off-the-shelf goods to “online marketplaces,” and says the process should be designed so that all federal entities would shop on these marketplaces, according to The Intercept.

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“It seems like Amazon wrote it,” Stacy Mitchell of the Institute for Local Self-Reliance — an Amazon critic — told the online magazine. “It will accelerate the transfer of more and more government spending to Amazon.”

This section of the act has been informally called the “Amazon Amendment,” according to  The Intercept.

“Experts believe only one or two companies would have the wherewithal to participate,” the digital magazine reported. “That means monopoly or duopoly control of $53 billion in federal purchasing.”

The change to procurement “signals likely dominance for Amazon Business, the company’s commercial sales platform,” The Intercept reported.

Amazon did not immediately respond to a request for comment.

Amazon is pushing hard to expand its business platform, recently introducing the $499 “Amazon Business Prime” with free two-day shipping. That announcement knocked the stock prices of Amazon’s two primary industrial-supply competitors for a loop, The Intercept reported.

“Amazon Business has already surpassed 1 million customers and $1 billion in sales,” the magazine reported.

“But federal procurement is the holy grail, the lucrative market to tap.”

 

Photo: Packages travel down a conveyor belt before being scanned and a shipping address is attached at the Amazon fulfillment center in Tracy, Calif., on Tuesday, April 12, 2016. (Doug Duran/Bay Area News Group)

 

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