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Pierre Endig | AFP | Getty Images
Amazon makes it easier for consumers to file a complaint when they believe they have been wronged by a product from a third-party seller.
On Tuesday, the company updated its long-standing return policy, known as the A-to-Z Guarantee, to address claims for defective products. Beginning September 1, consumers can contact Amazon with a personal injury or property damage claim, and Amazon will then connect the consumer with the seller.
Currently, buyers are encouraged to contact the seller if there is a problem, leaving Amazon largely out of the process.
The change resolves a long-standing problem in Amazon’s third-party marketplace, where counterfeits, unsafe products and even expired products have become a notorious problem and have caught the attention of lawmakers and regulators. The market, made up of millions of third-party sellers, has grown larger than Amazon’s own retail business and has helped the company develop other revenue streams like fulfillment services and advertisements.
Starting next month, consumers will be able to file product complaints directly with Amazon. Amazon said it would review claims using a combination of independent insurance fraud experts and its own fraud and abuse detection systems.
If Amazon determines that the claim is valid, it will contact the seller. Consumers will be able to appeal if they believe their claim has been wrongly dismissed, while sellers will be able to defend their product if Amazon contacts them. Amazon will also take care of the claim if the seller does not respond.
Last month, the U.S. Consumer Product Safety Commission sued Amazon to force it to recall dozens of defective products sold by merchants in its marketplace. The complaint also seeks to determine that Amazon is a “distributor” of consumer products under the Consumer Product Safety Act, and not just the owner of the platform through which the products are sold.
In recent years, many people who say they were injured by exploding hoverboards, faulty dog collars and overheating laptop batteries have sued Amazon for damages. This has sparked a heated debate over whether Amazon can be held liable for faulty products offered by third-party sellers on its site.
Amazon has pushed back litigation arguing that it’s just the platform, not the seller, shielding it from liability. The company claims that as an intermediary between buyers and sellers in its market, it is not involved in the sourcing or distribution of products sold by third party sellers. Several courts have sided with Amazon, but a series of recent cases have been against the company.
Lawmakers have also sought to update product liability laws in the e-commerce age to make Amazon, Etsy, eBay, and other companies responsible for the goods on their platform, just like the retailers are held responsible for goods sold in their physical stores.
Amazon has expressed support for the California bill on condition that it applies to “all online marketplaces, regardless of their business models,” while rival retailers feared it would stifle small businesses that sell products online. The bill, which has since been tabled, could have benefited Amazon because it has more resources to manage exposure to defective products than smaller platforms.
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