Amazon Finally Reviews It’s Third-Party Seller Terms After Several Probes
Amazon is undoubtedly the largest online retail market in the world, with third-party sellers making up 58 percent of its physical merchandise. Managing such a massive market is no mean feat. With Amazon continually trying to ensure transparency of transactions by enforcing stringent rules to guide buyers and sellers, they go overboard more often than not; several sellers get unfair Amazon account suspensions. This has been demonstrated when Amazon suspended the accounts of thousands of sellers without prior notice.
In response to this somewhat harsh treatment of third-party sellers, Germany’s Federal Cartel began a probe into Amazons Germany site, Amazon.de, at the end of 2018. After a seven-month investigation, Germany’s antitrust authority has agreed to stop further inquiries after Amazon averred to review its Business Solutions Agreement.
This new amendment will not only take effect in Germany, but in all of Amazon’s global marketplace in Britain, France, Italy, US, and Asia. The cartel office chief in Germany, Andreas Mundt, spoke about the probe and its outcome. “We have achieved far-reaching improvements for retailers on Amazon’s marketplaces. We are dropping our investigation,”, he said.
However, there seems to be no respite for Amazon as new sanctions have been placed on it by the EU for exploiting merchants’ data.
AMAZON SELLERS WILL NOW BE GIVEN 30 DAYS’ NOTICE BEFORE RECEIVING AN AMAZON ACCOUNT SUSPENSION
For a long time, sellers have beckoned on the administrators of the e-commerce platform to make improvements to its rule to further protect their businesses on Amazon. Many sellers have complained about Amazon’s unwarranted suspension of their accounts without giving any substantial reason as to the cause of such suspensions.
Now, Amazon has made some changes in the rules of its online marketplace, which is bound to take effect on August 16th. A few of these changes to its Business Solutions Agreement are listed below:
A 30 days’ notice, coupled with a detailed explanation of why they are being suspended, will be given to the sellers before they are issued an Amazon seller account suspension.
Amazon sellers are now able to sue Amazon to court in their own country with the help of an attorney to address Amazon suspensions, as this was previously only possible in Luxembourg.
Third-party sellers can now review Amazon’s decisions on which party is to shoulder the costs of refunds and returns.
These new terms, especially the ability to seek Amazon legal help, are set to give sellers more opportunities and choices when they are served an unfair Amazon account suspension. Also, it gives them adequate time to work on their Amazon Plan of Action and plead their case. The changes have been met with sharp criticisms by certain law experts stating that the agreement language is nebulous and as such gives Amazon too much advantage.
EU PROBES AMAZON FOR DELIBERATELY EXPLOITING MERCHANT DATA
The same day when changes to rules guiding sellers were announced, the European Commission also launched an investigation into Amazon’s usage of merchants’ sensitive data.
The concerns of the commission are that Amazon’s double role as marketplace operator and products’ retailer could give Amazon the independent seller data to develop its product. Amazon has, however, boldly come out to say that it only uses its data algorithm to “optimize what customers want to buy regardless of the seller.”
One of Amazon’s features the “Buy Box” gives third-party sellers a competitive edge for more business. The EU is looking into the Buy Box feature stating that the conditions for its allocation to sellers are rather vague and unclear.
Margrethe Vestager, the European commission’s competition Commissioner, has said that a thorough investigation of Amazon and all of its terms and policies is very crucial in laying down established rules and precedents.
Margrethe added, “the advent of eCommerce has brought about an improvement of pricing and quality of products as a result of a boost in competition. Large online platforms must be made to conform to the rules so as not to eliminate these benefits by exhibiting an anti-competitive behavior.”
Amazon’s boss and CEO, Jeff Bezos, in a recent letter to shareholders, said that “third-party sellers are kicking our first-party butt.”
Considering the recent sanctions and investigations, it is incumbent on Amazon to review most of its terms and come up with better rules; rules that will establish a fairer ground for third-party sellers. Sellers need policies that put an end to unnecessary Amazon account suspensions. Because only then can their businesses grow.
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