Amazon expected to face significant additional costs due to new anti-counterfeiting rules

A new Customs policy signed by the Department of Homeland Security is expected to add significantly to Amazon’s operating costs.

The new Customs and Border Protection framework will hold platforms responsible for policing counterfeit goods being sold on their platform or face considerable fines.

Amazon has a pronounced problem with counterfeits good being sold by its merchants but has so far escaped liability by saying it is merely a platform, not the seller.

With the new rules change warehouses and fulfilment centres will be held legally liable for holding goods which have not been sold to a specific customer, putting them on the hook for Section 321 enforcement.

This could mean “civil Fines, Penalties, and Injunctive Actions” with companies being encouraged to destroy potentially suspect shipments.

With Amazon running in a razor-thin 3.8% profit margin the extra policing is expected to impact their financials quite negatively.

Amazon’s share price fell on the publication of the new rules.

Via CCN