Ebay challenges firms over competition law abuse

Ebay is calling on the European Union to end what it calls the “abuse” of competition law by big brand names.

The online auction site said changes should be made to the legislation so companies can’t use selective distribution agreements with some retailers in order to stop goods being sold online by Ebay traders.

It said these agreements unjustly block the online sale of legitimate products by small traders and entrepreneurs and often result in consumers paying higher prices for products.

Ebay, which has been embroiled in ongoing legal battles with companies such as L'Oreal, Tiffany & Co and Louis Vuitton, presented members of the European Parliament with a petition. This has been signed by more than 750,000 European citizens, including more than a quarter of a million UK Ebay users.

The Ebay petition coincides with the Commission's public consultation on the revision of the European Vertical Restraints Regulation and Guidelines which concludes on 28 September.

Alex von Schirmeister, director general of Ebay, said: “Ebay was built on a simple idea, where practically anyone could buy or sell practically anything. Unfortunately, that idea is under threat from certain brand owners and manufacturers who are trying to block and restrict unfairly the sale of legitimate products on the internet.”

According to lawyers, Pinsent Mason, luxury goods manufacturers are allowed to require distributors to meet certain standards of knowledge; such as to have retailers meet a certain standard of shop fit-out and sense of luxury to match the brand.

However Ebay’s position is that brands should "not be allowed to impose blanket bans on internet selling, or keep online prices artificially high”.

The petition also calls for a presumption against manufacturers being " allowed to insist that internet retailers must have an offline retail store or impose more onerous sales conditions to online sellers".