The U.S. Consumer Product Safety Commission (CPSC) announced that Amazon must be held responsible for any defective goods sold on its marketplace.

The e-commerce giant previously argued that it only serves as an intermediary between consumers and third-party merchants through its services.

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Federal Regulators Requires Amazon to Bear Responsibility on Sold Goods' Quality

In a landmark order, the CPSC revealed that it has unanimously agreed that Amazon is classified as a distributor of goods, "and therefore bears legal responsibility for their recall."

The decision would require the company to develop a plan that will ensure that its customers are notified about the product hazards. The e-commerce giant must also inform and offer the public refunds and product replacement for damaged goods.

The agency also explained that the absence of such policies and remedial actions would only continue the distribution of hazardous products to customers' homes without any penalty from the law.

Amazon Faces Scrutiny on Lack of Accountability for Hazardous Goods

In 2018, Amazon was under fire for selling a faulty hoverboard that caused damage to a customer. The defective product exploded and burned down the customer's house in Tennessee.

The CPSC sued the company in 2021, forcing Amazon to recall hundreds of thousands of products that were classified as hazardous. About 418,818 goods were sold including faulty electronics like carbon monoxide detectors, hairdryers, and children's sleepwear.

"Amazon must therefore comply with the CPSA to protect consumers from injury," the decision read.

The e-commerce giant shared its disappointment with the decision and has plans to appeal. The company is firm that it has provided safety for every product in its marketplace, regardless of whether they are from a third-party seller or company-made.

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