Business News Weekly Roundup, June 12 2015

April saw US business inventories posting their largest gain since May 2014 the Commerce Department announced on June 11 (Reuters reports). The figure of 0.4% was well in excess of the estimated 0.2%, and is likely to result in economists revising their second-quarter GDP growth estimates for the US. This follows a more modest March in which GDP growth only stood at 0.1%.

First quarter estimates from the government initially suggested a 0.7% contraction, but retail figures, construction spending, trade and wholesale inventory, healthcare spending  and wholesale inventory came in at higher than expected levels may mean that no contraction occurred. Retail inventories excluding autos rose 0.6% in April, while business sales increased by 0.6% for the second consecutive month.

As part of ramped-up scrutiny of American technology companies, the European Commission has launched an inquiry to Amazon’s dominance of the ebook market, reports The Guardian. The inquiry will look into whether Amazon’s deals with publishers prevent fair competition from other players in the market. Contracts with these publishers may prevent them offering better deals to Amazon’s competitors; on occasion, Amazon asks that details of such deals are disclosed. Amazon has pledged to cooperate and has stated that its deal with publishers are well within the confines of the law.

Amazon recently altered its tax structures so that sales were no longer channeled through Luxembourg, taking advantage of the small state’s low levels of taxation. However it still faces questions from the European Commission’s competition department over a ‘sweetheart’ tax deal it secured in Luxembourg – so favorable that it may qualify as illegal state aid. Google also faces scrutiny over its dominance of the search market. Barack Obama recently warned that ‘protectionism’ in Europe could be a deterrent to US tech companies looking to move into the continent.