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With state budgets in the United States as strained as ever, increasing revenue is a top priority of state governments. One way states fund programs is revenue derived from licensing professional practices.

About one-half of states license auctioneers on a state-wide basis. Some states require only a fee be paid, while others require schooling, an apprenticeship, and/or an exam. There is increasing talk about licensing auctioneers in non-license states.

Too, there is some talk about eliminating state-wide licensing in a few states — and for the same reason — to increase revenue. These states have accumulated recovery fund accounts with sizable balances, and by eliminating the licensing agencies in those states, those funds could be redirected for other projects.

Nevertheless, our question here is, “Are eBay sellers auctioneers?” It may be reasonable to define basically two types of eBay sellers:

  • The eBay seller who sells their own merchandise
  • The eBay seller who sells other people’s merchandise

If licensing of individuals is prudent in order to protect the public, then it would seem that the latter type of eBay seller would require licensing more-so than the former, since the latter involves an individual or business entity taking in property from others, selling it for them, and then being responsible for a full accounting and proper settlement.

And, it may also be prudent to note that many states say that if a person acting as an auctioneer only acquires merchandise for the purpose of resale, licensing is still required, no matter.

It seems to me that if an individual takes in consignments from owners, sells those items for them, no matter if at auction or not, and then holds that money for the seller in escrow, etc., that such individuals or businesses should be licensed no less than any others in that same state who provide essentially the same service — such as auctioneers.

However, if a state doesn’t license auctioneers, or similar businesses (tag sale companies, estate sale companies, etc.) then the eBay seller who sells items for others is really no different, and mandatory licensing would be a difficult argument.

Ebay argues differently, and contents that the eBay auction format is fundamentally different than traditional auctioneering, so those sellers — no matter where the product comes from — should not be required to be licensed.

Ebay’s position paper is here: http://www.ebaymainstreet.com/policy-papers/auctioneering-regulations

Too, the question here may be generalized further, to ask if anyone, using any method including electronic platforms, and selling property belonging to others, should be licensed? Maybe so, if that same state stands firm that traditional auctioneers require licensing. This might, at some point, involve other companies such as Proxibid, ArtFact, LiveAuctioneers, iCollector, and others.

We’ll explore the merits of licensing auctioneers — at all — in our next post. However, it’s up to our governments to ultimately decide this issue. It seems to me we are still applying 1980’s laws and theory to 2009 business practices, for better or worse. It will be important for all auctioneers to keep an eye on these types of issues in the coming years.

Mike Brandly, Auctioneer, CAI, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, Keller Williams Auctions and Goodwill Columbus Car Auction. His Facebook page is: www.face book.com/mbauctioneer. He is Executive Director of The Ohio Auction School.