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UK Regulator Raises Serious Concerns Over Amazon's Investment In Deliveroo

Amazon.com Inc.'s (AMZN) investment in British online food delivery company Deliveroo raises serious competition concerns for UK customers that may require an in-depth investigation, U.K. competition regulator said.

In May, Deliveroo raised $575 million in a funding round, led by the e-commerce giant. Deliveroo gave Amazon a minority shareholding along with certain other rights, allowing it to participate in the management of the company.

The Competition and Markets Authority or CMA said Wednesday it would proceed to an in-depth investigation if the companies failed to offer legally-binding proposals that address the competition concerns.

The CMA's initial investigation has found that the investment, in its current form, could harm competition in two ways.

Firstly, the regulator is concerned that the deal could damage competition in online restaurant food delivery by discouraging Amazon from re-entering the market in the UK.

Secondly, the CMA is concerned that the deal could also damage competition in the emerging market for online convenience grocery delivery, where the two companies have already established market-leading positions.

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