, the Jersey based online retail store, has announced that it will close the retail arm of its brand in March 2013.

The business will concentrate on its marketplace offering going forward.

Citing the closure of a UK tax loophole, the company said it was a  "determining factor" to end its retail business. The UK government tightened up on VAT regulations, specifically the Low Value Consignment Relief (LVCR) which previously did not require items under £18 to pay full VAT duties.

It is estimated the VAT loophole cost the UK treasury £140m per year in lost revenue.

The VAT issue was blamed in part for the closure of a string of record shops, including Fopp, Zavvi and Virgin Megastores, who were unable to compete with the VAT concession sales from Jersey.

In September 2011, was taken over by Japanese e-commerce operator Rakuten. It paid £25m ($39.3m, 28.6m euros) for the company. will now focus on its Marketplace brand (think eBay or Amazon where others use it as a selling portal).  The company claims to have "more than 20 million listings" in Marketplace.


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