Wondering what you can sell on Etsy? Thinking of upcycling branded items to sell in your Etsy shop? Well, I’m Pam Duthie. I’m a veteran Etsy seller, Etsy Coach, and Etsy U instructor. On my YouTube channel, I share insider tips and advice for selling your craft on Etsy. My aim is to stay on top of any change that might impact Etsy sellers.
Have you heard that Etsy recently updated its Prohibited Items Policy? And that they did it without an announcement or heads-up of any kind? Meanwhile, we’ve seen a surge in Etsy shop suspensions lately. And some of them may stem from practices addressed by this policy change. So, today I’m going to show you what’s changed and what it means for us sellers.
The first I heard of this was in one of Reddit’s Etsy subs. So, hats off to that r/EtsySellers Redditor! We’re grateful they posted a warning about Etsy having quietly revised its Prohibited Items Policy. At first, I thought to myself, “Surely not.” Surely, Etsy would announce it’s made such a change, given the number of shops this could impact. And given that such a change could place a shop in jeopardy of suspension.
(And even knowing where to look, it actually took me a little while to find this!) However, once I found the page, sure enough. At the bottom it said, “Last updated on Apr 23, 2021.”
Etsy’s unannounced revision of its Prohibited Items Policy
Few of us have a photographic memory of what Etsy’s policies were before this change. Therefore, we are also grateful for the “Wayback Machine” Internet Archive. I simply selected a date before the change: March 30, 2021. Next, I asked the Wayback Machine to fetch the page. (I’ll give a link to the full page at the end of this post in the Resources section.)
There. Now we can compare it with the revised version, below. And sure enough. Buried in the middle there, we can see that a significant expansion of policy was made. It’s the third sentence. (I’ll link to this page on Etsy at the end of this post.)
But let’s back up a bit and start from the top. Note that in the introduction to the Prohibited Items Policy section, Etsy tells us:
“This policy is a part of our Terms of Use. By opening an Etsy shop, you’re agreeing to this policy and our Terms of Use.”
Excerpt from Etsy Terms of Use: Prohibited Items Policy
Hmmm, so we’re agreeing to abide by the policy, but they’re changing it without telling us. The revision is in Section Five, “Illegal Items, Items Promoting Illegal Activity, and Highly Regulated Items.”
That section begins,
“We respect the law and expect Etsy sellers to respect the law as well.”
Next, under “More Details,” it goes on:
“Illegal items, items that promote illegal activity, and stolen items are not allowed on Etsy. Neither are certain items that are subject to complex legal regulations or registration systems. Because Etsy is a global company, it’s important to abide by the laws of the markets in which you are selling. What is legal in one country may be illegal in another. All forms of illegal activity are strictly prohibited. Listings may not facilitate or promote illegal acts.”
(Yes, all of that totally makes sense and all of this was here before. It’s what we signed up for.)
“Counterfeit or unauthorized items are prohibited on Etsy.”
(Fair enough; that bit is the same as before.)
“We consider counterfeit or unauthorized goods to be items that imitate an authentic good, particularly by using a brand’s name, logo, or protected design without the brand owner’s consent.”
(This too is the same as before. In fact, I made a recent video about whether you can sell fan art on Etsy. I’ll link to it at the end. The answer is no, you can’t, and this policy makes it clear.)
The change is this next sentence, which is the third sentence in that same paragraph.
“Additionally, we may consider up-cycled or repurposed items, even if using authentic materials, to be counterfeit if they are making use of a brand’s name, logo, or protected design without their permission.”
Excerpt from Etsy Terms of Use: Prohibited Items Policy
(The rest of that paragraph is unchanged. It reads:)
“Examples of prohibited counterfeit or unauthorized goods include replica luxury and non-luxury items like bags and branded apparel.”
How does this change what you can sell on Etsy?
The concern that the Etsy Redditor was quite rightly flagging for our seller community is this. It’s a change that could hit everybody who is altering or otherwise repurposing branded items. Everyone upcycling designer apparel. Including sneakers, boots, shoes. All of you who paint them, embellish them, make them into a statement piece, then list them for sale on Etsy. And it is not only apparel. Are you adding vinyl to a brand’s reusable coffee cups?
So many sellers are upcycling on Etsy! Because it sure did seem to be allowed, even encouraged! Etsy listing templates I’ve seen even have an attribute field for “Recycled.” You choose Yes if “your item contains materials recovered or diverted from the waste stream during the manufacturing process or after consumer use. Learn more here.” (Under Resources, I’ll link to that Learn more article.) I think many of us just assumed you could buy or otherwise acquire something, alter it in some way, then list it in your Etsy shop.
The distinction Etsy is clarifying with this newly-added sentence is this. It’s not about whether the material is new or recycled. It is about whether it is branded. Are you using branded items to make your creation? Painting a pair of Doc Martens or adding bits to a Gucci bag? Are you making use of the brand’s name, logo, or protected designs without the brand’s permission?
Then that could get you into trouble. Note that Etsy’s language is fuzzy here. “We may consider up-cycled or repurposed … to be counterfeit.” They don’t say whether they will or they will not. They say, “may.”
Disclaimer! I am not a lawyer!
Firstly, if this is sounds anything like something you make and list on Etsy, you should contact Etsy. To be sure what you are doing is okay. (And don’t assume the “First Sale Doctrine” will protect you; it appears that it may not.)
And yes, of course you should also contact the brand owner or their representative. But go in knowing that it may take a long time to hear back. I’ve contacted a few brands just to see what the process is. None of them have gotten back to me yet. So start by contacting Etsy and see what they say.
And before going any further, let’s just pause here for this disclaimer.
Disclaimer: I am not a lawyer! I have never studied law. Therefore, I am not qualified to advise you. If you want to offer upcycled / altered branded items for sale in your Etsy shop, you need to consult a lawyer who specializes in this field.
My guess? Etsy will handle this the same way they do any sort of copyright issue. Like other third-party seller platforms, Etsy claims safe harbor status under the DMCA (Digital Millennium Copyright Act). This status relieves Etsy from liability for copyright infringement by its users.
Under the provisions of that status, Etsy need do nothing until the copyright holder complains. When a copyright holder complains, Etsy removes the listing. And makes a note of it in the seller’s account. (More about that in a bit.)
Before this policy clarification, here’s how it went. These copyright holders would search Etsy for violations of their intellectual property. If they found tons, they didn’t bother to sort between them. Fraudulent counterfeits of their designs? Altered their product to make something new? They would just put in a claim to Etsy to remove it all.
Due to the terms of its safe harbor status, Etsy cannot make a further determination. Etsy would just say okay, and everything got yanked. I expect this will not change.
What might change? With this Prohibited Policy update, Etsy may choose to suspend more shops that get reported more than once. Here is what you need to know. Even if the law of the land comes down on the side of upcyclers. (And there’s been a recent somewhat-related high-profile court case. I’ll link my video about it just below, in my final paragraph.) Wherever case law ends up going, Etsy has the right to ban a user engaging in the practice on their platform. And by making this change to their Prohibited policy, Etsy is signaling just that: they might.
Therefore, if you’re doing anything even close to using branded products, contact Etsy. And take note. Just scrubbing your listings and images of a brand name or logo may not be enough. You may need to remove the item. At least for now. So, check with Etsy. Better yet, consult an attorney. Protect your shop and your permission to sell on Etsy.
What does this mean for the rest of us Etsy sellers?
It means that important policies can be changed without notice or warning. As that same Redditor pointed out, Keep in mind that per its TOU, Etsy itself determines what constitutes a “material change” in policy. So, they weren’t required to alert us about this policy update. One that can impact whether we can continue to sell on Etsy. Remember: we only know about this one thanks to an eagle-eyed good Samaritan who happened to spot this and who chose to share it with fellow sellers.
Which means that as a community, we sellers have to stick together. Make sure we share what we find with each other. And I’ll keep you posted!
This blog post is based on a video on my YouTube channel. I also made two follow-up videos. The first follow-up focuses on a court case brought by a big brand against a company that altered then sold the brand’s product. The next one covers replies I got from Etsy to my queries on this topic. Etsy representatives were able to expand a bit on some reasons why brands issue take-down requests. And they also mentioned this. Much as they regret it, they may suspend shops that get repeated take-down requests. So, beware, and be careful out there!
Pam Duthie
RESOURCES:
- Etsy’s “House Rules” / Terms of Use
- Etsy’s “House Rules,” Section Five Prohibited Items Policy
- Wayback Machine version, March 30, 2021
- Wikipedia entry: DMCA Digital Millennium Copyright Act
- US Government PDF on the DMCA
- Etsy’s “House Rules” / legal terms and policies related to Recycled Content
- My video about selling Fan Art
