Newegg policy update: withholding payments from some buyers and extending return periods

According to foreign media reports , some sellers on the Newegg platform received an email from the company, the main content of which was that Newegg was changing its   Terms of Use for Sellers on Marketplace.

According to Newegg, the company is making some improvements and these policies are implemented to enhance customers' shopping experience on Newegg.

According to the notice, Newegg will no longer be the seller of record . Instead, the seller will become the seller of record . In addition, Newegg will withhold a portion of the buyer's payment, and the return date has also been extended . Most of these policies will take effect on October 1. The details are as follows:

The seller will be the retailer of record

Sellers should be the seller in the sales transaction. Starting October 1, 2021, Newegg will contact sellers to request the ownership information of the company. This is part of Newegg's due diligence process and regular monitoring of seller accounts.

Withholding part of the payment for refund reserve

Newegg may withhold a portion of the amount to cope with potential returns or refunds. The amount withheld will depend on the seller's historical return and refund rates. Sales run rate and account balance will also be taken into account when calculating the withheld amount . This policy will take effect from October 1, 2021.

30 days return from product delivery date

Starting October 1, 2021, Newegg's return period is 30 days from the invoice date .

Taxes and remittances (U.S. only)

As the seller of record, Marketplace sellers will instruct Newegg to collect and remit sales tax to any jurisdiction within the U.S. For states with MarketplaceFacilitator laws , Newegg will collect and remit sales tax on behalf of Marketplace sellers and remit sales tax to the taxing authority of the jurisdiction .

Regarding Newegg's new policy, many sellers said that they had to wait 15 days to get paid before, and the new payment withholding policy will bring a greater burden to sellers.

Some sellers also said that the new return policy extends the time buyers can return goods, which will lead to an increase in buyer returns and fraud. "Websites such as Facebook Marketplace only give buyers three days to return goods, but their business is also booming."

Combined with the recent policy updates of other e-commerce platforms (such as Wish), stricter monitoring and inspection of seller account information seems to be a new practice for e-commerce platforms. Sellers must pay attention to completing information in a timely manner and operate in compliance with regulations.

Newegg

Policy Updates

Seller