marketplace--trading on others sites?

[lob]

Hi to all

We are currently trading on a marketplace website which has a clause in the contract saying we are not allowed to trade on a similar 'marketplace' site
However Ebay, Amazon and possibly Etsy and Folksy are allowed

I would love to hear others opinions on what the law is in this matter
By signing the contract (which is updated periodically) are we constrained by this clause
Is it considered a restrictive practice to stop you being able to trade?
Other 'shops' on the site do trade on other sites but many do not use their company name even when the products are obviously identical

If we use another name (we have other website names we could use) would this enable us to trade legally on other sites selling the same products?

I would love to hear any comments
Many thanks
lob

 

[SamStones]

What name is the contract signed in ? If it's all under one company name then I doubt you could consider it "legal" , but it would depend on the terms of your contract. If you were John Smith trading as "ABC Goods" I don't see why you couldn't sell on another site as John Smith trading as "XYZ Goods" - unless the contract was signed by you individually?

I've never heard of such a contract in the past, sounds rather odd! Do they guarantee a level of sales or something?

 

[lob]

Hi Sam

Thanks for the response
Here is the relevant clause amongst the many others!! (see below)

We are a partnership and have been trading with ***** since June 2008 under our company name
Recently a forum for ***** has been set up and clearly other 'partners' in ***** have been given differing info as to where they can and can't trade and much is made of how much the different partners are making for *****
It seems where the partner is doing well then ***** would prefer to look away and let the partners trade on another site
Some are selling on Etsy and Folksy but for some reason this seems OK too

We have signed up to 2 other marketplaces and have heard nothing from ***** but they may not realise we are on these other sites as there are so many partners involved
We would prefer to be out in the open and grow our brand and sales

I am interested as I thought it was not possible to stop people trading as it would be anti-competitive and restrictive but am I correct?

And in answer to the last question, no, they do not guarantee any sales
We paid a joining fee and pay a fairly high percentage for every sale but ***** are a well known marketplace and we get good sales
We just would like to continue doing sales on ***** and elsewhere too!!

Thanks again
lob

4.1.16 to sell their products only through such similar or competitive online marketplaces as are specifically approved by *****. For the avoidance of doubt, Member Partners may sell through their own websites, and through the website known as Ebay.co.uk, and through the website known as Amazon.co.uk. Member Partners may not otherwise sell their products through any other marketplace-type website unless expressly approved by *****. Such approval and permission is likely to be withheld if ***** deems the website in any way competitive to the ***** website. Request must be made in writing and permission will be granted in writing. No other permissions will apply. For the avoidance of doubt any breach of this Clause shall be deemed to be a material breach for the purposes of Clause 13.1.1 and ***** reserves the right to de-activate a Member Partner’s Dedicated Marketplace Area for such period as the Member Partner’s Products are listed on a competitor marketplace.

 

[SamStones]

Just a quick one: Look at it this way: Can you afford to lose the business you currently get from this one web site? Or does it make up the lions share of your sales?

 

[Miles Shelbourne]

You should be aware that if your actions amount to a breach of contract the other party may not only deactivate your account, but they may sue you for damages for breach of contract. So if you go on selling for two or three years, and then the issue comes to light, you may find that you face a large claim... Of course the issue in damages is what is the other party's loss, which I have no idea about, but note: contracts have teeth, that is their object.
Miles, Solicitor
NB - the above given without any liability as I do not have the full facts.

 

[Billmccallum]

Ask them to change the agreement, taking out the clause you don't want.

If you are doing good sales on their iste and they are taking good commissions, they will not want to lose you.

Rather than break the agreement, simply ask them to change it.

You can always threaten to stop using them if they dont agree.

 

[lob]

Many thanks to all who replied

Sam, yes, we do well on ***** site and would not want to lose the business
If we sell different items under a different name would this be OK do you think?

Bill, I think it highly unlikely that they would change the rules for us as there are many other partners in the same position although there is a bit of an uprising going on as there is now a new forum where these points are being brought up and ideas exchanged

Miles, yours is the scariest answer of course
The terms and conditions are altered every now and then on the website
The partners are not always told, therefore may not be aware of changes made
Is this allowed? I would have thought we should always be informed of changes?

I think the answer is to change the name we trade under on the other sites
Other companies do this and I cannot see that ***** can complain if we do this
It just means our brand name is not being advertised to the full extent
As we make our products, they are not bought in and they are individual they cannot be bought elsewhere so if sold under another name it will not matter
They are still our products but under another name

Thanks again