Starting an Online Selling Business in Europe

In this article, we’ll talk about the advantages of starting an online selling business account on marketplaces (Amazon, eBay) in Europe and what’s required to start.

eBay was founded in 1995. This platform is a worldwide online marketplace where buyers and sellers can meet and trade almost everything. eBay’s yearly net revenue was more than 10 billion dollars in the most recent fiscal year, up from 8.6 billion dollars the year before
(The source – Annual net revenue of eBay from 2013 to 2020).

Amazon is an American giant that has been capturing new markets for years and is now the world’s largest sales platform. In 2020, Amazon achieved the highest revenue in its history in Europe: EUR 44 billion.

Why is it worth selling on online marketplaces?

Store owners on marketplaces have access to tools to build their own brand and optimize sales levels. Owning an online store is the best way for sellers to grow their online trading business.

Which documents are required for online selling in Europe?

eBay, Amazon, or Alibaba are at the forefront of the e-commerce world. Setting up a company on those platforms is associated with meeting certain requirements imposed by the European Union. Building a fully-fledged e-commerce business is the foundation for creating a solid high-income business. Which documents should be collected to become a legal online seller? If you considering setting up an internet business on eBay for example, these are the documents you may want to collect:

Identity Card and Personal Address Proof
Legally recognized business
VAT Certificate
EORI number
Account for payments

1. Identity Card and Personal Address Proof

Identity card and personal address proof confirm the identity of the seller. First, a valid identity proof such as passport, identity card, driving license, etc. is required. The second document is one that confirms the address of residence. This is for example bank statement, electricity bill, or water bill.

2. Legally recognized business

The legal identity of the e-commerce seller’s company is the registered company. The requirements differ from country to country. On the other hand, the EU urges all countries to reach specified targets for assisting in the formation of new businesses. For new enterprises, there are a variety of EU subsidies available. In the example of Estonia, a person registering a company should perform the following steps:

Apply for e-Residency

Start a limited company through the e-Residency programme

Open an EU IBAN account connected to your limited company

Conduct online business in Hungary, Germany, Czech Republic, Turkey, Poland, Serbia, Estonia, USA or Kuwait.

3. VAT Certificate

VAT (value-added tax) is collected at each level of the supply chain by all vendors of products and services. This implies that VAT is paid on all purchases by suppliers, manufacturers, distributors, retailers, and end-users. In contrast, in the United States, sales tax is solely levied on the ultimate customer. When selling to an EU customer as a European company: distance selling laws apply to internet dealers situated in the EU who offer items to European customers. The supplier is responsible for the delivery of products sent to a private customer in another EU member state via distance sales. In most countries, the seller can register for VAT online and fill out VAT returns on the website of the local tax office.

4. EORI number

EORI stands for “Economic Operators Registration and Identification number”. When sharing information with Customs administrations, businesses and persons willing to trade must use the EORI number as an identifying number in all customs operations. It is more efficient for both commercial operators and customs officials to have a single form of identifying number across the EU. Moreover, it is also more efficient for security and statistical considerations.

5. Account for Payments

Is it required to have a bank account to open an seller account on eBay, Amazon or Alibaba?

It is required to have an authorized account in the name of the company. The seller can use a credit card, direct debit, or PayPal to pay eBay seller fees. eBay uses the payment details the seller has given to charge his monthly invoice. If the seller is a managed payments seller, his final value fees are automatically deducted from his sales, and the remaining amount is paid out to his bank account (The source: eBay – User Agreement).

A credit or debit card is required to open an account on Amazon. However, you don’t need a card issued for the company’s data for which the sales account will be created. It is important that the card is valid and one that allows you to make payments via the Internet. Your card will be charged for your Amazon account fees.

It is similar to opening a seller’s account on the Alibaba platform. A credit or debit card is also required on this site. However, in this case, it is possible to set up a seller account with PayPal, Western Union, L/C.

eBay user residing outside the United Kingdom but within the European Union concludes an agreement with eBay Canada Limited, 240 Richmond Street West, 2nd Floor Suite 02-100, Toronto, Ontario, M5V 1V6, Canada

Gurcan Partners is a professional law and consultancy firm.
We are ready to help you with all the necessary services of setting up an internet business on eBay in Hungary, Germany, the Czech Republic, Turkey, Poland, Serbia, Estonia, the USA, Kuwait.
Contact Us: info@gurcanpartners.com

All rights reserved. All rights of Starting an Online Selling Business in Europe article belong to Gurcan Partners. The author has no responsibility for the information of this article. This article is prepared just to inform.

Marta Nowak

Gurcan Partners Warsaw Office

Address :

Polna Corner, 3A Warynskiego Street, 5-6th Floor, Warsaw/ Poland

@: info@gurcanpartners.com

Phone: +48 22 153 03 60 (English)