Is Reselling Legal? A Guide to Resale Laws and Regulations [2025]

Is reselling legal? If you’ve ever considered diving into the world of reselling, you’ve probably wondered about the rules and risks involved.

Can you really buy and sell products for profit without stepping into legal gray areas? Generally, reselling items that have been lawfully acquired is considered completely legal.

In this article, I unravel the mysteries of resale laws, brand restrictions, and tax obligations. Ready to discover how to stay compliant while maximizing your profits? Let’s get started.

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What Is Reselling?

Reselling is all about buying something to resell items to someone else at a higher price to make a profit.

It’s like finding a hidden gem for a great deal and then sharing it with others—only you get paid for your effort.

You don’t have to be the one creating or manufacturing the products; instead, you’re the bridge between the supplier and the customer.

How Does Reselling Work?

Here’s how it works in real life.

Let’s say you find a pair of limited-edition sneakers online for $150. You know sneakerheads are willing to pay double that price because it’s a hot item and hard to find.

You buy them and list them on a platform like eBay or StockX for $300. Once someone buys them, you’ve made a nice profit. That’s reselling.

Online reselling is a growing trend in e-commerce, offering both convenience and potential legal challenges. It’s important to understand what it means to be a reseller in this context.

Hence, you can resell anything—clothes, electronics, collectibles, even digital products like software or eBooks. What’s important is knowing your audience and where they hang out.

For example, if you’re selling handmade jewelry, platforms like Etsy or Instagram might be your best bet. But if it’s gadgets or electronics, Amazon or eBay might work better.

The trick is to find items at a low cost, maybe through thrift stores, clearance sales, or wholesalers, and make sure they’re in demand. You don’t need a ton of money to start, just a good eye for deals and a platform to sell on.

Reselling can be as simple as flipping items you already own or scaling up to build an online store. It’s flexible, fun, and can turn into a solid side hustle—or even a full-time business.

Is Reselling Legal?

Yes, reselling is generally legal in most cases, but there are a few things you should be aware of to ensure you’re doing it the right way.

At its core, reselling involves buying a product legally and selling it to someone else—and this is perfectly fine as long as you follow some basic rules.

Understanding Reselling Legalities

The most important thing is making sure the items you sell are acquired legally. If you buy from trusted sources like wholesalers, retailers, or clearance sales, you’re generally in the clear.

It is also crucial to understand both state and federal laws to ensure compliance and protect consumers.

However, if you’re unknowingly reselling stolen or counterfeit items, that’s where things can get messy—and even result in legal trouble.

For example, imagine buying what looks like a genuine luxury handbag from an unknown supplier and later finding out it’s a fake. You could face fines or lawsuits if customers report it.

1. The First Sale Doctrine: A Reseller’s Best Friend

The first sale doctrine is a game-changer for anyone looking to resell legally.

This rule allows you to resell authentic copyrighted items—like CDs, books, and software—without needing permission from the copyright owner. Basically, once you’ve legally purchased something, you’re free to sell it.

For instance, if you buy a popular movie DVD from a store, you can list it on eBay or Amazon and resell it.

However, this doesn’t apply to digital items like music downloads or software licenses, as these are often tied to the original buyer.

Always double-check the terms of purchase, especially for digital products.

2. Branding, Business Registration, and Taxes

Another thing to consider is branding. Yes, reselling is legal, but be careful about this one.

If you’re reselling branded products, be careful not to market them in a way that could confuse customers into thinking you’re an authorized dealer. This could get you into trouble with the brand owner.

For instance, you can say you’re selling Nike shoes, but avoid presenting yourself as an official Nike retailer unless you have their permission.

Transitioning from reselling to creating your own brand can help expand and legitimize your online business.

Moreover, if you’re starting a reselling business, make sure you follow local laws, register your business if required, and pay taxes on your earnings.

Some states or countries may also require a resale certificate if you’re buying from wholesalers. Doing it the right way not only keeps you legal but also builds trust with your customers.

3. Manufacturer Restrictions and Platform Rules

Here’s where things get a bit tricky: about 80% of manufacturers enforce resale restrictions. This could mean limits on selling products outside certain regions, using unauthorized platforms, or even prohibiting resale entirely.

Always check for these rules before making a purchase. For example, some high-end brands won’t let you sell their products unless you’re an authorized retailer. Reselling illegal activities can lead to serious consequences, so it’s important to understand and comply with all relevant laws and regulations.

Reselling platforms like Amazon, eBay, or StockX also come with their own unique terms and conditions. Understanding these rules is crucial.

For example, if you’re selling sneakers on StockX, they have strict authenticity checks. Failing to meet their standards could get your account flagged or banned.

Top 7 Reselling Platforms and Regulations in 2025

StockX

StockX is one of the top platforms for reselling sneakers, thanks to its reputation for authenticating every product sold.

This ensures that buyers receive genuine items, building trust and confidence in the marketplace.

As a seller, you also get access to real-time market data to help you set competitive prices.

StockX features sneakers from almost all major brands, including Nike, Adidas, Puma, Michael Jordan, Yeezy, Vans, and even luxury brands.

Also, prices range widely, starting as low as $56 and going up to $2,000 or more.

For example, if you manage to snag a pair of Yeezys for retail, you could resell them here at a significant markup.

Selling on StockX is simple, but their regulations are strict. Every product sold must pass StockX’s authentication process before being released to the buyer. Sellers are required to ship their items to a StockX facility within two business days of the sale.

If your item fails authentication—for example, if it’s not brand-new or genuine—it will be returned, and you may incur penalties.

Also, sellers must also comply with StockX’s standards for accurate product descriptions and proper packaging.

StockX charges a 3% payment processing fee in addition to their transaction fees, which start at 9.5% for new sellers and decrease as you make more sales. Failure to follow their rules could lead to account suspension.

GOAT

GOAT is another excellent option for sneaker resellers, offering a vast catalog of brands like Air Jordan, Nike, Adidas, Supreme, Fear of God, and even luxury names like Gucci and Saint Laurent.

Also, prices range from $25 to over $100,000, making it a platform with something for every buyer.

GOAT enforces strict regulations to ensure product authenticity. Every item sold must go through GOAT’s authentication process, where experts verify that the sneakers are genuine and in the described condition.

So, sellers must use the shipping label provided by GOAT and ship items within three business days.

If an item fails authentication or doesn’t meet GOAT’s standards (e.g., used when marked as new), sellers may face penalties, including account suspension.

GOAT charges a 9.5% commission fee for most sales, which can increase to 15% for international sellers or those with a poor selling history.

There’s also a 2.9% cash-out fee when transferring your earnings to your bank account. Sellers must maintain compliance with GOAT’s standards to avoid higher fees or account restrictions.

eBay

eBay is a classic platform for reselling sneakers, offering a broad audience and a range of potential buyers. With millions of users, a sneaker is sold on eBay every five seconds.

The platform supports major brands like Adidas, Nike, Jordan, Vans, and Puma, making it suitable for all kinds of resellers.

eBay’s regulations are less strict compared to StockX or GOAT, but sellers are still required to follow their guidelines for authenticity and transparency.

Listing counterfeit or misrepresented items is strictly prohibited, and violations can lead to account bans. Sellers are also expected to ship items promptly, usually within the timeframe specified in their listing.

For sneakers sold over $100, eBay provides an authenticity guarantee, meaning your items must pass an inspection by eBay’s partners.

eBay’s fees are competitive. For sneakers sold for $100 or more in the U.S., the final value fee is just 8%, with no additional processing fees. For items under $100, the standard 12.9% fee applies.

Amazon

Amazon provides incredible exposure for sneaker listings, thanks to its massive user base. You can leverage Amazon FBA (Fulfillment by Amazon) for fast and efficient shipping, streamlining the entire selling process.

Moreover, popular brands on Amazon include New Balance, Adidas, Nike, Skechers, and PUMA, with prices ranging from $25 to $200.

Selling sneakers on Amazon comes with stricter regulations. Sellers must apply for brand approval for items like Nike or Adidas, providing a wholesale invoice or brand authorization letter.

Amazon also prohibits counterfeit or unauthorized products, and any violations can result in account suspension or removal from the marketplace.

Additionally, sellers using FBA must comply with Amazon’s packaging and shipping standards.

Amazon charges a 15% referral fee for the sale of sneakers. If you use FBA, you’ll also pay fulfillment fees based on the item’s size and weight.

Facebook Marketplace

Facebook Marketplace is a flexible platform for selling sneakers, allowing both local and global transactions.

One of the best features is that it doesn’t charge listing fees, so you get to keep more of your profits. Buyers and sellers can communicate directly, which makes negotiating and personalizing transactions easier.

While Facebook Marketplace has fewer formal regulations, sellers must still comply with Facebook’s Commerce Policies.

This includes prohibitions on counterfeit items and deceptive practices. Sellers should be upfront about the condition of their sneakers and provide clear descriptions.

For items sold with shipping, Facebook charges a 5% selling fee or a flat $0.40 for items under $8.

Poshmark

Poshmark is a thriving platform for reselling sneakers and other fashion items, offering a user-friendly app and community-driven shopping experience.

Popular brands like Nike, Adidas, Puma, Vans, and Jordan are frequently sold here, with prices ranging from $25 to $500 or more.

Poshmark has strict rules to maintain its marketplace quality. All items must match the description in the listing, and counterfeit products are not allowed.

Sellers are required to use the prepaid shipping label provided by Poshmark and ship items within three days of a sale. Failure to ship or frequent cancellations can result in penalties or account suspension.

Poshmark charges a flat $2.95 fee for sales under $15 and 20% of the sale price for items over $15. While the fees are higher than some platforms, Poshmark’s engaged community often justifies the cost.

Mercari

Mercari is a versatile platform that caters to resellers looking to sell sneakers and other items in various conditions, from brand new to pre-loved.

Ticket reselling, particularly for high-demand events like Taylor Swift’s concerts, has sparked controversy and legal challenges, highlighting the need for clear regulations on platforms like Mercari.

Also, popular brands like Nike, Adidas, New Balance, and Vans perform exceptionally well here, with prices ranging from $20 to $300.

Mercari’s regulations focus on transparency and authenticity. Sellers must accurately describe their items, including any flaws, and counterfeit items are strictly prohibited.

Shipping must be completed within three business days, using either Mercari’s prepaid labels or your own method. Sellers who cancel orders frequently or fail to ship on time may face penalties.

Mercari charges a 10% selling fee on each sale and an additional 2.9% + $0.50 processing fee per payment.

Thus, these fees, combined with its straightforward process, make Mercari a great choice for new resellers.

Other Ways To Resell Online in 2025

Your Online Store

Setting up your own online store gives you full control over pricing, branding, and customer interactions.

You can source sneakers directly from trusted suppliers like Foot Locker or Eastbay or use sneaker bots to snag rare pairs at retail prices.

Once you have your inventory, it’s time to build your store.

Platforms like Shopify, WooCommerce, or WordPress make it easy to create an online store. Hence, you can upload high-quality photos of your sneakers, write detailed descriptions, and start marketing.

For example, if you’ve secured a few pairs of limited-edition Yeezys, showcase their rarity and quality to attract buyers.

Dropshipping

If you want to avoid managing inventory, dropshipping is a fantastic alternative. With dropshipping, you partner with a supplier who ships products directly to your customers.

One of my go-to suppliers is BrandsGateway, which offers access to over 100 luxury brands like Nike, Gucci, and Adidas.

BrandsGateway integrates with platforms like Shopify and Wix, making the entire process smooth with automated order processing and real-time inventory updates.

For instance, if you’re dropshipping a pair of Adidas sneakers, all you need to do is list the product on your store, and the supplier handles the rest.

This eliminates the risk of unsold stock while still allowing you to sell in-demand sneakers.

In short, reselling sneakers can be highly profitable, whether you use platforms like StockX and GOAT or explore dropshipping and your own online store.

The key is choosing the right platform and strategy that fits your goals and experience.

Legal Issues and Concerns in Reselling: Trademark Infringement

1. Brand Restrictions in Reselling

When you’re getting into reselling, brand restrictions are a big deal. Many brands put rules in place to control how their products are distributed.

These restrictions help maintain the brand’s image, ensure product quality, and fight counterfeiting. But here’s the catch: if you’re not an authorized reseller, you could face some serious legal risks.

Let’s take Nike as an example. Nike has strict reselling rules to protect its brand. Selling their products without approval can lead to legal headaches like cease-and-desist letters or even lawsuits. That’s why understanding a brand’s policies is so important.

Ignoring these rules could damage your reputation and hurt your chances of working with other brands down the line.

It’s not just about the brand’s policies, though. You also need to know the laws.

Therefore, selling branded goods without permission can land you in trouble with trademark issues or hefty fines.

So, doing your homework on the laws and brand-specific requirements is key to protecting your business. The more you know, the better prepared you’ll be.

Here’s the bottom line: selling branded items isn’t as easy as it looks. Brands change their policies all the time, so staying updated is crucial.

Being informed about brand restrictions and reselling laws helps you avoid problems and keep your business on track.

2. Consequences of Illegal Reselling

Let’s face it—illegal reselling isn’t worth the risk. The penalties can be severe, with fines often exceeding any profits you’ve made from unauthorized goods.

Brands and wholesalers may sue you, leading to costly legal battles and hefty damages. Some laws even carry criminal charges, especially in cases like ticket scalping where strict regulations apply.

Why does this matter? Reselling laws vary based on location and product type. What’s legal in one area could be illegal in another.

For instance, certain states limit ticket resale prices, and platforms like Amazon strictly enforce policies to protect intellectual property. Not knowing the rules doesn’t excuse you from penalties.

The damage goes beyond finances.

Selling unauthorized goods destroys trust with customers and can result in account bans on major platforms like eBay or Amazon. So, losing access to these marketplaces can devastate your business.

How do you stay safe?

Research local laws, follow platform policies, and use tools like LegalZoom to stay updated. Knowing the rules keeps you in the clear and builds credibility with buyers.

Illegal reselling isn’t just risky—it can ruin your reputation and future opportunities. Stay informed, follow the rules, and protect your business.

Collect Sales Tax and Reselling Obligations

Sales tax is one of those areas that many resellers overlook—until it becomes a problem. So, knowing the ins and outs of sales tax obligations is critical if you want to keep your reselling business safe and legal.

Here’s what you need to know.

Most resellers do, depending on their location and the applicable state laws. If you’re operating a reselling business, you’ll need to register for a sales tax permit in your state.

For example, if you’re based in Texas and selling to customers within Texas, you’re required to collect and remit sales tax.

But here’s the catch: sales tax isn’t just about where you’re based—it’s also about where your customers are.

The concept of NEXUS is key. Nexus refers to the connection between your business and a state. If you have a physical presence (like a warehouse or office) or meet a certain sales threshold in a state, you may need to collect sales tax there.

For example, selling through platforms like Amazon FBA could create a nexus in multiple states where Amazon has fulfillment centers.

How can you manage it?

Tools like TaxJar or Avalara can handle the complexity for you. They calculate sales tax automatically, file returns, and keep you compliant with evolving tax laws.

If you’re doing retail arbitrage—buying products locally to resell online—these tools are especially helpful in tracking tax obligations for different states.

What happens if you don’t comply?

States don’t mess around. Failing to collect or remit sales tax can lead to fines, interest charges, or even audits. For example, California has aggressively pursued online sellers for unpaid taxes in recent years, and audits can be both time-consuming and expensive.

How To Navigate Reselling Online in 2025? [ Best Practices]

1. Understand Platform Rules

Before jumping into reselling, know the rules of the game. Every platform has its own guidelines, and ignoring them can cost you big time.

For example, Amazon’s rules prohibit selling counterfeit goods and require approvals for certain brands.

Facebook Marketplace, on the other hand, is more flexible but still has limits on items like weapons or recalled products.

How can you get started?

Read the seller policies on platforms like eBay, Amazon, or even Depop. If you’re planning to sell on multiple platforms, tools like Vendoo or Crosslist can help manage your listings while keeping things compliant.

For instance, I personally use AutoDS, since it integrates seamlessly with my Shopify store and all other marketplace storefronts I have.

Take the time to learn what’s allowed and what’s not, as each site enforces these rules strictly. A simple slip-up—like listing branded goods without permission—can result in account suspension or permanent bans.

Also, don’t assume the same rules apply everywhere. For instance, eBay might let you sell used branded items, but Amazon often doesn’t.

Always double-check! If you’re unsure, reach out to the platform’s customer support or join seller forums where experienced resellers share tips.

2. Get the Required Permits

Let’s talk about legality. If you’re planning to resell seriously, you need the right permits. In most places, this means a business license or seller’s permit, especially if your sales hit a certain threshold. Without these, you’re risking fines or even having your business shut down.

How do you get them?

Check with your local government or state website. Some places make it super easy to apply online, while others may require an in-person visit.

For example, you can use apps like LegalZoom or Incfile to sort this out if you’re unsure where to start.

Having the right permits not only keeps you compliant but also makes your business look professional—something buyers notice.

For example, in California, a seller’s permit is required if you’re selling taxable goods. Not sure if you need one?

A quick call to your local tax office can clear things up. Staying legal builds trust with buyers and platforms, which helps you stand out in a competitive market.

3. Sell Authentic Products

This is a big one: always sell genuine items. Nothing ruins your business faster than being accused of selling fakes.

Not only is it illegal, but platforms like eBay or Amazon won’t hesitate to shut you down. Plus, customers can file lawsuits or leave scathing reviews that kill your credibility.

How do you ensure authenticity?

I advise you to source products from trusted suppliers. Thus, websites like Fair, SaleHoo, or direct brand partnerships are great options.

If you’re reselling used items, double-check their condition and origin. For example, when reselling luxury watches or designer handbags, consider using services like Real Authentication to verify their legitimacy.

If you’re caught selling counterfeit goods, you could face fines, lawsuits, or bans from platforms. But here’s the thing: being transparent about your inventory builds trust with your customers.

Hence, share photos, detailed descriptions, and proof of authenticity when needed. Your reputation is your biggest asset, so protect it by keeping your products 100% legit.

4. Resell Used Items

Reselling used items is one of the easiest ways to start making money online. Whether it’s vintage clothes on Depop, old tech on eBay, or even furniture on Facebook Marketplace, there’s a market for nearly everything. Plus, it’s eco-friendly—a win for you and the planet!

What’s the process? Start by sourcing items locally. Check out thrift stores, garage sales, or even Craigslist for deals. Then, clean or refurbish the items to make them look presentable.

For instance, platforms like eBay and Mercari are great for listing used goods because they attract buyers looking for bargains.

But here’s the thing: make sure the items are legally acquired and in good condition. Selling broken or stolen goods isn’t just unethical—it’s illegal.

Take clear photos, write honest descriptions, and set fair prices. For example, if you find a pair of vintage Levi’s jeans for $10, reselling them for $50-$100 is entirely possible with the right audience.

By focusing on quality and transparency, you’ll build trust and loyal buyers.

5. Avoid Counterfeit Goods and Protect Data

Selling fake goods? Don’t even think about it. Counterfeit items aren’t just bad for your business—they can lead to legal trouble.

If a buyer reports you for selling fakes, platforms like Amazon or Etsy will ban your account in a heartbeat. Worse, you might face lawsuits or fines.

How do you avoid this?

Stick to reliable suppliers like Zendrop, Spocket, or even wholesale distributors directly approved by brands.

If you’re unsure about a product’s authenticity, apps like GoVerify can help. And don’t cut corners. For example, if a supplier offers “designer bags” for dirt cheap, it’s probably too good to be true.

Data protection is another area you can’t ignore. When handling customer info—like names, addresses, or payment details—always use secure payment gateways like PayPal or Stripe.

If you’re running your own website, ensure it’s SSL-encrypted (you’ll see the little padlock in the URL bar).

6. Source Legally

When it comes to reselling, the foundation of your business lies in sourcing products legally and reliably.

This means you should always purchase items from trustworthy suppliers to ensure the authenticity and quality of what you’re selling. Selling counterfeit or stolen goods can not only damage your reputation but also lead to legal troubles.

One of the best ways to source products legally is to use Dropshipping.com’s Supplier Directory.

This platform connects you with vetted suppliers from around the world, ensuring that the products you’re selling are genuine and of high quality.

With access to thousands of suppliers, you can filter by product categories, shipping times, and even location to find the perfect fit for your reselling business.

Why is this important?

Let’s say you’re looking to sell branded sneakers. By sourcing directly from a reliable supplier through Dropshipping.com, you can avoid counterfeit issues and ensure your products meet platform regulations on marketplaces like Amazon or eBay.

For example, I once needed a supplier for luxury handbags and found one through Dropshipping.com.

Not only did they provide an authenticity guarantee, but they also offered competitive wholesale prices, which helped me maintain solid profit margins while keeping my business legally compliant.

Conclusion

Reselling can be an exciting and profitable way to make money, but it’s important to go about it the right way.

From this article, you’ve learned that it’s perfectly legal to resell products as long as you follow key rules like sourcing items from legitimate places, respecting brand restrictions, and staying on top of sales tax requirements.

Before diving in, take the time to understand the platforms you’ll be using and make sure you’re selling authentic, quality products.

My advice? Be transparent with your buyers, stay informed about the laws, and never cut corners.

Reselling is a great opportunity, but success comes from doing things the right way and building trust with your customers. Take it one step at a time, and you’ll be on your way to running a thriving resale business!