Registering a merchant company on Amazon: why do you need the help of a lawyer

Amazon sellers face a variety of regulatory requirements, especially in areas such as product safety, labeling, and import regulations. However, going through the legal compliance procedure for a company is an equally complex process that requires careful understanding and compliance with many regulatory rules. Amazon also uses a series of verifications and machine learning to prevent unscrupulous sellers from registering.

To do business on this largest global platform, you must understand that Amazon collects and reports seller tax data to the appropriate tax authorities. It may include sales, income and other data. Why do Amazon and other marketplaces comply strictly with these requirements and are essentially tax intermediaries?

The first reason is that the marketplace must comply with various international and local laws and regulations, including those related to import, export, taxation, and intellectual property.

The second reason is that strict requirements help combat fraud and illegal activities on the platform, such as selling counterfeit products or copyright infringement.

Third reason to protect consumers, Amazon is committed to guaranteeing the safety and quality of the products offered on the platform.

Merchants must consider several legal and corporate requirements, which may vary depending on the region where the company plans to begin or expand its operations. Registering a company on the platform requires submitting a number of specific documents that will help certify the company's legal status and ability to trade internationally. Here is an approximate list of main documents:

1) Company Incorporation Documents: Constituent documents such as a certificate of incorporation, company articles of association, articles of incorporation or similar documents that confirm the legal existence of a company.

2) Tax information: tax identification numbers (e.g. EIN in the US) and corresponding tax forms.

3) Bank Account: a valid bank account is required to conduct transactions and receive payments, and in some cases, you may need to open such an account in a specific country or region.

4) Financial Statements: To prove its financial condition and ability to run the business.

5) Proof of Legal Address: Documents that prove legal address, such as utility bills or a lease agreement.

6) Licenses and Permits: Depending on the category of goods to be sold, appropriate licenses or permits may be required.

7) Identification documents: personal documents of the founders or managers of the company, such as passports or residence permits.

Although Amazon recently launched its "Manage Your Compliance" program, which includes a compliance dashboard, a compliance help tool, and a checklist for identifying and resolving compliance issues, the complexity and variety of compliance requirements remain very high. Experts can assist in identifying required documents, supporting the registration process and managing compliance, providing nominee services, opening an account, obtaining licenses, and providing advice on adapting to changes in regulatory requirements. It will help you avoid potential violations that could lead to suspension or failure to comply and will also allow you to manage risk and protect your brand on the platform.

Recently, we were contacted by an entrepreneur from Kazakhstan who faced a problem when going through the Amazon compliance procedure for his British trading company. The marketplace expressed suspicions that the place of business management needs to be revised since the founder and director are located in Kazakhstan, and the company is registered in the UK. To refute doubts and confirm that the company is truly managed from Britain, we offered a comprehensive solution, providing the entrepreneur with services to provide local directors and shareholders in the UK, and also prepared the necessary contracts and took into account other legal nuances to prove the legitimacy of the business by Amazon requirements.

It is worth emphasizing the importance of legal support in this process because, as the example of an entrepreneur from Kazakhstan shows, Amazon's complex requirements for the legal status and management of merchant companies can create significant difficulties. Professional legal services make these requirements easier to navigate and help you avoid potential problems associated with violating platform policies. Antwort Law has over 8 years of experience supporting international businesses and will gladly assist you with any legal compliance procedures on Amazon and other marketplaces.

Lidia Ivanova

International lawyer
Antwort Law

Why is compliance so difficult for Amazon and other marketplaces? And why do you need the help of a lawyer when going through compliance?
First, they are required to comply with a variety of international and local laws. Secondly, they strive to combat fraud and illegal activities. Finally, this is done to protect consumers by guaranteeing the safety and quality of suppliers on the platform. The lawyer also helps to provide the necessary documents and prepare the company for the compliance procedure, avoiding potential violations that could lead to suspension of activities or failure to comply.
What documents are needed to pass compliance on Amazon?
The standard package includes company registration documents, tax information, bank account information, financial statements; documents confirming the legal address (for example, utility bills); licenses and permits, documents of founders and directors.
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