One of the largest ‘Made in China, sold on Amazon’ companies had 340 stores closed, US$20 million in funds frozen amid crackdown
- Stores run by Shenzhen Youkeshu Technology were shut down for allegedly violating Amazon’s rules
- The affected stores made up 30 per cent of Youkeshu’s total retail presence on the e-commerce platform
The action was taken against stores run by Shenzhen Youkeshu Technology for allegedly violating Amazon’s rules, without providing any details, according to a filing this week by the merchant’s Shenzhen-listed parent Tiza Information Industry Corp.
The affected stores, the operations of which Amazon had either banned or frozen, made up 30 per cent of Youkeshu’s total retail presence on the platform, according to Tiza. It said more than 130 million yuan (US$20.08 million) of Youkeshu’s funds have been frozen and estimated the retailer’s first-half sales this year to be reduced by 40 to 60 per cent.
Tiza said in its filing that “rules on e-commerce platforms have been tightening, as rights infringement and review manipulation continued to increase”.
Youkeshu’s case marks the latest blow to the “made in China, sold on Amazon” community, comprising mainland retailers that have flocked to the US platform in a bid to reach international customers.
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“Amazon can suspend sales or freeze the funds of stores for [selling] products with intellectual property risks and [over] customer complaints,” Tiza said in its filing. It said more than 130 million yuan (US$20.08 million) of Youkeshu’s funds have already been blocked by Amazon.