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Amazon is ubiquitous. Whether you’re a consumer clicking “Add to Basket” or a business selling goods to millions of customers, Amazon’s platform is at the center of modern e-commerce. Yet surprisingly few people understand how the platform actually operates, who they are contracting with, or what rights and obligations arise from that relationship. This article provides a practical overview of how Amazon works in the United Kingdom from both a consumer and a seller perspective and highlights the key legal issues businesses should be aware of.
Amazon Is Not Just a Retailer
The most common misconception about Amazon is that it is simply a shop. In reality, Amazon operates a dual model. It acts both as a direct retailer, selling its inventory, and as a marketplace platform connecting independent third-party sellers with consumers. When you buy something on Amazon.co.uk, the seller might be Amazon itself, or it might be one of the hundreds of thousands of independent businesses listing products on the platform.
The scale of the third-party marketplace is striking. Globally, over 60% of all units sold on Amazon come from independent sellers rather than Amazon’s own retail operation. In the UK alone, there are over 330,000 active sellers on the platform. These range from sole traders running a side business to multinational brands using Amazon as a primary sales channel.
This dual nature matters because the identity of the seller determines who is legally responsible for the product. Amazon’s own Conditions of Use make this explicit: where a third-party seller is involved, Amazon states that it is “neither the buyer nor the seller” of those items and provides only the venue for the transaction. The contract of sale is formed directly between the buyer and the third-party seller.
With whom are you actually contracting?
No single company runs Amazon’s UK operations. The corporate structure involves several Luxembourg-registered entities with UK branch operations. Amazon EU SARL is the principal selling entity for physical products. Amazon Media EU SARL handles digital media. Amazon Digital UK Ltd, registered in England, is the seller of record for Prime Video and Prime Music. Amazon Europe’s Core SARL owns and maintains the website itself.
This distinction matters for several reasons. First, the Conditions of Use specify that they are governed by the laws of the Grand Duchy of Luxembourg, with the application of the United Nations Convention on Contracts for the International Sale of Goods expressly excluded. However, UK consumers retain the benefit of mandatory UK consumer protection legislation. Second, if you needed to bring a claim, identifying the correct contracting entity is an essential first step that many businesses overlook.
How Does the Marketplace Work for Sellers?
Sellers who wish to list products on Amazon.co.uk must agree to the Amazon Services Europe Business Solutions Agreement. This is a comprehensive contract that governs the entire seller relationship, from listing products and processing payments to handling returns and managing intellectual property complaints.
Under this agreement, Amazon acts as the seller’s agent for the purposes of processing customer payments, but it is important to understand that Amazon is not the seller’s partner. Amazon retains significant control over how products are displayed, which seller “wins” the Buy Box (the prominent purchase button on a product listing), and the commercial terms under which vendors operate. Amazon may also suspend or terminate a seller’s account if it fails to meet performance metrics or breaches Amazon’s policies, sometimes with very limited notice.
Fulfilment by Amazon (FBA)
Many sellers opt into Fulfilment by Amazon (FBA), where Amazon stores the seller’s inventory in its warehouses and handles packing, shipping, and customer service. Over 82% of Amazon sellers globally now use FBA in some form. The benefits are clear: products become eligible for Prime delivery, Amazon handles returns, and sellers gain access to Amazon’s world-class logistics network.
However, FBA comes with costs. Sellers pay storage fees, fulfilment fees, and various additional charges. Amazon’s FBA Service Terms also give Amazon considerable discretion over how inventory is handled, including the right to dispose of stock that has been stored for extended periods. For businesses with seasonal or slow-moving inventory, these terms can have significant financial implications.
Consumer Rights and the Amazon Framework
When Amazon sells products directly, the Conditions of Sale apply. These confirm that the contract of sale is formed when Amazon sends a dispatch confirmation email, not when the order is placed. Consumers benefit from a 30-day voluntary return guarantee for most products, which is more generous than the 14-day statutory right under the Consumer Contracts (Information, Cancellations, and Additional Charges) Regulations 2013.
For purchases from third-party sellers, Amazon provides the A-to-Z Guarantee, which allows customers to claim a refund if an item does not arrive, arrives damaged, or does not match the listing description. Amazon expanded this guarantee in 2024 to cover claims for personal injury or property damage caused by defective products sold by third-party sellers, reflecting growing regulatory expectations that platforms should bear some responsibility for the safety of products sold through them.
It is important to note that these Amazon-specific protections sit alongside, and do not replace, consumers’ statutory rights under UK law, including rights under the Consumer Rights Act 2015.
The Buy Box and Competition Concerns
One of the most commercially significant features of Amazon’s marketplace is the Buy Box”—the prominent panel on a product page that includes the “Add to Basket” and “Buy Now” buttons. When multiple sellers offer the same product, only one seller “wins” the Buy Box at any given time, and that seller captures the vast majority of sales for that listing. The algorithm that determines Buy Box allocation considers factors including price, fulfilment method, seller performance metrics, and stock availability.
This system has attracted significant regulatory scrutiny. The UK’s Competition and Markets Authority (CMA) opened an investigation into Amazon in 2022 under the Competition Act 1998, examining whether Amazon held a dominant market position and whether its practices around the Buy Box and use of third-party seller data were anti-competitive. In late 2023, Amazon offered commitments to the CMA covering three key areas: restrictions on how Amazon uses data obtained from third-party sellers; changes to how the Buy Box winner is selected; and allowing third-party sellers to negotiate their delivery rates for Prime-eligible orders.
An independent trustee, overseen by the CMA, now monitors Amazon’s compliance with these commitments. These changes hold significance for businesses selling on the platform, as they theoretically aim to establish a more equitable playing field.
Fake Reviews and the New Enforcement Landscape
Reviews are the lifeblood of e-commerce, and Amazon is no exception. An estimated 90% of consumers use reviews when making purchasing decisions, and the CMA has estimated that up to £23 billion of annual UK consumer spending may be influenced by online reviews.
In June 2025, the CMA announced that Amazon had given formal undertakings to improve how it tackles fake and misleading reviews. These commitments followed a four-year investigation and require Amazon to implement robust processes for detecting and removing fake reviews, address “catalogue abuse” (where sellers hijack the positive reviews attached to one product and reassign them to an entirely different product), impose sanctions on businesses and individuals responsible for fake review activity, and provide clearer reporting mechanisms for consumers and businesses.
This announcement is particularly important given the new enforcement framework under the Digital Markets, Competition and Consumers Act 2024 (DMCCA), which came into effect on 6 April 2025. Under the DMCCA, fake reviews are expressly prohibited, and the CMA now has the power to impose fines of up to 10% of a company’s global turnover for breaches of the consumer protection law – without needing to go through the courts. Businesses selling on Amazon should take a particular note: the CMA is actively conducting a sweep of review platforms and has signalled that enforcement action will follow.
Intellectual Property on the Amazon Platform
For businesses that own trademarks, designs, or other intellectual property, Amazon presents both opportunities and challenges. The platform offers several IP protection tools. Amazon Brand Registry allows trademark owners to register their brands, gain greater control over product listings, and access enhanced reporting tools. Project Zero goes further, enabling registered brands to remove counterfeit listings directly without needing to file individual reports. The transparency program uses unique serialised codes on products to verify authenticity at the point of fulfilment.
However, the sheer volume of listings on Amazon means that IP infringement remains a persistent issue. Counterfeit goods, listing hijacking (where an unauthorised seller attaches themselves to a brand’s product listing), and the misuse of trademarks in product titles and descriptions are common complaints. Amazon’s internal dispute resolution mechanisms can be slow and unpredictable, and sellers accused of infringement may find their accounts suspended before they have a meaningful opportunity to respond.
For trademark owners, a proactive strategy is essential. Registering with Brand Registry, monitoring listings regularly, and having clear enforcement procedures in place can make a significant difference. At Lawdit Solicitors, our dedicated trademark practice at www.trademarkroom.com regularly advises clients on protecting their brands on Amazon and other online marketplaces.
What Businesses Should Take Away
Amazon’s ecosystem is complex, and the contractual and regulatory framework that governs it is evolving rapidly. Whether you are selling on the platform, buying from it, or trying to protect your intellectual property, there are several practical points to keep in mind.
First, understand who you are contracting with. Amazon’s multi-entity structure means that the correct legal counterparty may not be obvious. Second, if you are a seller, read the Business Solutions Agreement carefully. Amazon has broad rights to change fees, suspend accounts, and alter the terms of engagement, often with limited notice. Third, monitor your intellectual property. The tools Amazon provides are useful but not a substitute for active enforcement. Fourth, be aware of the regulatory environment. The CMA’s recent interventions on the Buy Box, seller data, and fake reviews signal a more assertive approach to platform regulation in the UK, and the DMCCA gives regulators powerful new enforcement tools.
Amazon is a remarkable commercial platform, but navigating it successfully requires an understanding of both the opportunities and the legal risks. If you need advice on any aspect of selling on Amazon, protecting your brand, or understanding your rights as a consumer, please get in touch with the team at Lawdit Solicitors.
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