Not upheld: wrongful account closure and fund restriction complaint against Amazon Payments UK Limited (APUK)

Decision detail

Summary

M, an Amazon seller, complained that APUK wrongly withheld its seller account funds from April 2025 and closed its account in August 2025 based on AEU's determination that M had not provided satisfactory evidence of UK establishment for UK VOEC purposes. M's directors argued they are UK-established but cannot provide VAT returns as they are below the VAT threshold, and claimed APUK should release the funds. The ombudsman found that while a dispute exists between M and AEU regarding UK establishment, the FOS cannot adjudicate disputes with AEU. The ombudsman determined APUK acted fairly under the Selling on Amazon User Agreement by withholding funds during the unresolved dispute, as the agreement permits such restrictions when disputes exist or financial risk is present. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman determined that while a dispute exists between AEU and M regarding M's UK establishment, the FOS cannot consider disputes with AEU as it is not a regulated entity within FOS jurisdiction. The ombudsman could only assess whether APUK, as a regulated payment service provider, acted fairly. Under section 2.7 of the Selling on Amazon User Agreement, APUK has broad discretion to restrict account access when financial risk exists or disputes are unresolved. Given the unresolved VAT establishment dispute between M and AEU, APUK's withholding of funds was in line with the contractual terms and therefore fair and reasonable.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website