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Play.com to shut down direct retail business, become marketplace

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Play.com is to close down its direct retail business and shift to an online marketplace from spring 2013, it has been announced.

The e-tailer will make 147 staff redundant in Jersey by March, as well as 67 at its offices in Cambridge and Bristol.

Play.com is to become purely a marketplace for other sellers, and not sell goods directly to customers itself.

The company will take a slice of sales, similarly to the marketplaces operated by eBay and Amazon.

Play, which was bought by Japanese retail giant Rakuten for £25 million in 2011, said that the move was down to the removal of a tax loophole on certain goods sold from the Channel Islands last year.

The Low Value Consignment Relief (LVCR) allowed items with a value under £15 to be sold to the UK VAT free, but was scrapped in April 2012.

"Following strategic review of out business operation, we have announced a company restructure," said Play.com in a statement.

"Moving forward we are intending to focus exclusively on our successful Marketplace, which is our main business area, and to phase out the direct retail part of our business.

"The removal of LVCR implemented in April 2012 has been a determining factor in this decision."

Around 400 people are understood to have lost their jobs in the Channel Islands due to the end of LVCR in 2012.

This includes 16 people made redundant last July after Jersey-based flower delivery business Flying Flowers closed its doors.

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