EU Public Consultation on Brand Restrictions
A growing number of consumer goods suppliers prevent their authorized distributors from offering their goods for sale on open online marketplaces such as eBay. Platform bans allow brands to keep prices artificially high, restrict consumer choice and may breach EU competition rules.
The use of marketplace bans is a widespread anti-competitive practice in many consumer product markets, with over half of European sellers now affected by platform bans. In some industries, nearly all leading brand manufacturers have imposed a marketplace ban on their retailer.
Recent research shows that 88% of shoppers expect their favourite brands to be available through online marketplaces such as eBay, and 61% of shoppers expect to find the best prices through these sites. However, as a consequence of marketplace bans, consumers are restricted from buying their favourite products at competitive prices via their preferred and trusted online and mobile commerce channels, and may pay higher prices because they cannot use marketplaces to efficiently compare prices.
eBay believe e-commerce should be open for all and call on the EU Commission to step up its enforcement actions against these anti-competitive practices. Earlier this year eBay highlighted a number of brands which give resellers the freedom to sell their products online without imposing sales restrictions (at least one of which in the past imposed restrictions but is now reformed).
Now eBay have have spoken to retailers and the video below highlights a British, German and Italian seller all of whom have had their businesses damaged by protectionist brands.
In its preliminary report on the e-Commerce Sector Inquiry, the European Commission recognises the importance of online marketplaces for small businesses and cross-border trade. The report also rightly shows that marketplace bans prevent a significant number of small business entrepreneurs from selling products on online marketplaces and that these bans harm consumers by limiting choice, increasing prices and hindering cross-border trade.
The EU are inviting all stakeholders (and that includes you if marketplace brand restrictions have impacted you) to submit your views for consideration. The deadline to make your comments is the 18th of November 2016.