Online customers buying fruit and vegetables must be told by Amazon exactly where they come from, just as customers could check the labels on supermarket shelves or other retailers. Munich's Higher Regional Court has ruled. It said that the EU standards in question applied to all, even an online retailer.

Berlin-based lobbyist Foodwatch had sought a restraining edict against "Amazon Fresh," citing EU internal market and customs laws, after making test purchases of items such as avocados, mangoes, paprika, apples, grapes and tomatoes.

In the first purchase in 2017, items such as lettuce and lemons did not have origins stated on the website at the point of purchase. In the second 2019 purchase, Amazon stated intended places of origin, but the food items came from other countries, according to Foodwatch.

Amazon's EU division had argued that sourcing from a particular country was "not possible," for example, if a party host ordered strawberries three weeks in advance but this was upset by weather or problems at harvest. The online giant said that wastage could result.

It also claimed strict EU labeling of contents only applied to wholesale packaging.

In mid-January, the Munich Regional Court had agreed with Foodwatch that if Amazon did not comply it could be fined €250,000 ($302,000). This ruling was backed by Munich's Higher Regional Court on Thursday.

The appeal chamber's presiding judge Andreas Müller took less than two hours on Thursday to declare that it was against EU consumer law to have ordered mangoes from Senegal, but to then get mangoes sourced from Israel.

When the online handler stated its grapes came either from Italy or Brazil or India or one of 10 other countries, then this breached EU law on transparent labeling, said Müller.

"Maybe in the autumn I would like to have grapes from a European country and not from South Africa," he added.

Business model flawed

If Amazon's business model did not function because of these complications, then the online-handler had to change it and not expect the customer to conform, he concluded.

"This is because it is not the business model that determines the validity of European Union rules, but the Union rules that determine whether a business model is permissible," the Munich Regional Court had already stated on January 14.

In court on Thursday, Amazon's lawyer, cited by the German news agency dpa, said orders were now being taken only three days in advance in a bid to comply. The sales volume had sunk over 20% as a result, she said.

Hardly earnings in perishables?

With the exception of specialists such as wine traders, online merchants in Germany had so far made little money from online food sales, according to the Cologne-based EHI retail research institute, while customers flocked to supermarkets and discounters.

However, beyond perishable foodstuffs, Germany's BEVH online commerce federation observed a 40% boom in online sales last year amid the coronavirus pandemic  compared to 2019 — primarily in the entertainment goods sector, followed by clothing, furnishings and recreational items.

In 2018, some 47% said they spent much the same via online and mail-order platforms compared to their purchases at retail shops. By last year, that preference toward online services had risen to 63%, albeit at a highly unusual time for high street retailers.

ipj/msh (dpa, AFP)