EBay Targets Renegade Sellers

SAN FRANCISCO — EBay Inc. is moving to limit sellers from providing hyperlinks from their Internet auctions to other Web sites, part of a broad effort to crackdown on eBay users who settle trades outside of eBay.

The San Jose, Calif., Internet auction company late Thursday notified its users that it will ban hyperlinks from eBay auction pages to independent Web sites that list items for sale outside of eBay. Sellers that violate the new policy, which will go into effect May 31, may have their auctions terminated, their eBay account suspended or have their eBay home page removed, the company said in a notice posted on its site.

The company has had a long-standing policy that defines what material auction listing pages are allowed to contain on eBay, but the new policy more explicitly defines the types of links that it won’t permit.

The move is part of growing campaign at eBay (EBAY) to combat “off-market” transactions, in which sellers consummate deals outside of eBay in order to avoid paying the company’s auction fees. The amount of commerce involved in such deals is impossible to quantify, but many observers of eBay’s auction business believe it is enormous.

EBay, which has long forbidden off-market trading, has taken the threat seriously. Late last year, the company began punishing users who use telephone or e-mail contact information to settle their deals outside of eBay. All eBay users agree as part of their user agreement with eBay not to trade outside of eBay the same items that are listed on the site. The company says that off-market transactions also mislead sellers into believing that they are protected by eBay’s auction fraud and insurance policies when they are not.

“Sellers that attempt to divert buyers off eBay potentially decrease the value of the marketplace to the entire community,” eBay said in a notice on its Web site announcing the new policy. “We believe that by clarifying and enforcing this policy we will strengthen the marketplace for everyone.”

The new hyperlink policy is sure to generate concern among some eBay sellers, many of whom operate independent Web sites for selling merchandise. Under its new policy, eBay will allow its auction listing pages to link to other auction listings on eBay or Half.com, a trading site owned by eBay.

Users will be able to include a single link to a Web page outside of eBay that further describes the auction item listed on eBay, but the page can’t advertise any non-eBay merchandise. The company will allow small “third-party credits” on auction listing pages – for instance, an icon that identifies the payment service a seller offers to settle a transaction.

EBay also has relaxed an earlier policy that limited the links from a different area of its site, called the About Me page. EBay provides all of its users with an About Me page, effectively a personal home page on eBay where uses can describe their business or interests. Under its new policy, eBay will let users link to independent Web sites or online stores from their About Me page, but users can’t advertise any non-eBay merchandise on the page itself.

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