eBay not an auction house says German court

More like a catalogue, really

By Lucy Sherriff • Get more from this author

Posted in Financial News, 3rd November 2004 16:29 GMT

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A German civil court has ruled that commercial sellers on eBay are obliged to accept returned goods, even if the purchaser gives no reason for sending the item back.

The decision was taken based on a piece of European legislation, The Consumer Protection (Distance Selling) Regulations Directive, which was passed in 2000. This covers both goods and services, and applies where the contract is made without any face to face contact between supplier and consumer.

The ruling means eBay transactions are classified along with other methods of distance selling, such as mail order catalogues, for example, rather than as auctions. In Germany, auctions are not covered by the directive. For guidelines on how the law works in the UK, go here.

Judges at the Federal Court of Justice in Karlsruhe said that exceptions should be rare. In an email quoted on on Bloomberg the court said: "The consumer who buys a product in an Internet auction is exposed to the same risks as in other forms of distant selling".

Judges made the ruling after hearing a case brought by a jeweller who was not paid for a bracelet sold on eBay because the purchaser was unhappy with the product.

Legal experts in Germany are concerned that the decision could have significant repercussions throughout Europe, saying that disputed sales could even end up in European Court of Justice in Luxembourg, the EU's highest court. They also warn that the ruling could discourage sellers from setting low minimum prices, as they will need to cover the costs of potential returns.

In the UK, eBay flags the directive on its policies page, warning sellers that their goods might be covered by the act. ®