Amazon.com Inc (NASDAQ:AMZN) has been told it is now required to handle the recalls of unsafe products sold on its site, according to a ruling by US regulators.
The US Consumer Product Safety Commission (CPSC) decided that Amazon's current alert system was inadequate in ensuring customers stopped using dangerous items.
Therefore, the e-commerce giant has been ordered to develop a new plan for responding to recalls.
It comes after a 2021 lawsuit in which the CPSC accused Amazon of distributing over 400,000 hazardous items, including defective carbon monoxide detectors, hairdryers lacking electrocution protection and children's pyjamas that did not meet flammability standards.
In response to the ruling, Amazon said it intended to appeal.
"We are disappointed by the CPSC’s decision. We plan to appeal the decision and look forward to presenting our case in court," Amazon said in a statement.
Amazon defended its current practices, claiming that it had already stopped selling the unsafe products, notified customers, and issued refunds.
However, the CPSC criticised Amazon's notifications for not using the term "recall" and for failing to sufficiently highlight the need to return or destroy the items.
Amazon has consistently argued that it should not be held liable as a "distributor" under the law, positioning itself as an external logistics provider.
The US government agency countered by arguing that service extends beyond typical shipping duties, including management of the return process, communication with customers, enforcement of pricing rules, and screening items for eligibility.
"We stand behind the safety of every product in our store," Amazon said on Tuesday, adding that it had measures in place to prevent unsafe products and to monitor listings.