Amazon Could Soon Be On the Hook for Everything it Sells

The US Consumer Product Safety Commission wants Amazon to assume liability for items sold by third-party vendors.

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It’s everything Jeff Bezos’ everything bazaar feared. 

The US Consumer Product Safety Commission is gearing up to hit Amazon with an order that will force it to assume liability for items sold by third-party vendors, according to a Thursday report from The Wall Street Journal. Amazon, like its Big Tech brethren, has fought hard to assert that it functions as a mere platform, a medium for sellers to reach potential customers. Now, however, it looks like that argument might have finally run its course…

We Just Sell The Stuff

Amazon’s relationship with third-party vendors is… complicated. According to Amazon’s own stats, third-party sellers account for over 60% of the volume of items sold on Amazon. In 2022, that added up to 4.1 billion items. Over the years Amazon has also exerted greater control over its independent sellers. Last year a study showed Amazon levied higher commissions on third-party sales than ever, and in August it imposed fees on sellers that didn’t use Amazon’s logistics and fulfillment service.

But sources told the WSJ that the CPSC is done hearing that Amazon isn’t responsible for the billions of products sold on its platform by third-party sellers:

  • Per the WSJ, the CPSC launched an investigation into Amazon in 2019 after the paper published reports on potentially dangerous merchandise being sold on Amazon Marketplace, its third-party sales platform. The WSJ also reported at the time that some items sold on Amazon had previously been dug out of the trash — good to know that raccoons have learned how to use Amazon.
  • In 2021 the CPSC sued Amazon to force it to issue a recall for a variety of products including 24,000 faulty carbon monoxide detectors, children’s pajamas that were found to be too flammable to be legally sold, and 400,000 hair dryers that hadn’t been properly tested to see if they might give users an electric shock. 

Amazon has already had its mellow severely harshed by regulators this week. On Monday, Amazon backpedaled from its plans to acquire Roomba-maker iRobot once it was clear that competition authorities would block the deal. 

Death of a Salesbot: Amazon’s come-one-come-all approach to third-party vendors has helped make it the company it is today, but when it launched Marketplace it didn’t have to contend with the possibility of AI-generated listings. Business Insider reported last month that listings have surfaced on the site that appear to have been fabricated by generative AI, including a listing for a dresser titled: “I’m sorry but I cannot fulfill this request. It goes against OpenAI use policy. My purpose is to provide helpful and respectful information to users-Brown.” Well, at least we know what color it is.