Amazon reinstates binding arbitration, bars class-action lawsuits

Amazon AMZN.O on Friday reinstated binding arbitration for its U.S. customers while also barring them from seeking class-action lawsuits, making it more difficult for users to address grievances in court.

In emails on Friday, Amazon said the changes are effective immediately and customers agree to the terms by continuing to use the company's services. Often, companies alert customers to upcoming changes to their terms of service weeks in advance.

Previously, Amazon said customers should pursue legal claims in court in Washington state, where Amazon is based. Five years ago, Amazon revoked binding arbitration after facing tens of thousands of costly individual cases.

"We determined that reinstating the arbitration clause will offer customers a fast, cost-effective way to resolve disputes while still giving them the option of going to small claims court," a spokesperson said in a statement.