Shipping matters to an online seller for a reason beyond happy buyers: in the United States it is a legal obligation. The Federal Trade Commission’s Mail, Internet, or Telephone Order Merchandise Rule requires you to ship within the time you stated, or within 30 days if you stated none, and to offer a refund when you cannot.

The rule is 16 CFR Part 435. The FTC explains it in plain language in its business guide, which is the source for this post unless noted. Both were checked on October 12, 2026. This is a summary for sellers and not legal advice.

Who the rule covers

The FTC’s guide says the rule applies to most goods a customer orders from a seller by mail, telephone, fax or on the internet. It applies however you advertised and however the buyer paid. The guide lists a few exemptions, including magazine subscriptions after the first shipment, seeds and growing plants, and collect-on-delivery orders. Services are not covered. The exemptions are about the kind of sale, not the size of the seller, so a one-person shop taking orders through its own website should assume the rule applies.

The four duties

Duty What the FTC rule requires
Have a basis for your shipping promise When you advertise, you need a reasonable basis for any shipping time you state. If you state none, you need a reasonable basis to believe you can ship within 30 days
Ship in that time The clock starts when you receive a properly completed order: payment plus all the information needed to process and ship it
Tell the buyer about a delay If you cannot ship in time, you must offer the buyer the choice to agree to the delay or to cancel for a prompt refund
Refund promptly When an order is cancelled, the refund is due within seven working days for most payment methods

One exception to the 30 days: if the buyer is applying for credit from you to pay for the order and you stated no shipping time, the period is 50 days.

“Shipped” means in the carrier’s hands

The rule defines shipment as “the act by which the merchandise is physically placed in the possession of the carrier” (16 CFR 435.1). Printing a label does not count. Marking an order as shipped does not count. The deadline is met when the carrier has the package. On a tracking page the first carrier scan is the usual evidence of that handoff; Shipping Label Created alone does not show it.

A stated shipping time replaces the 30 days

You are not required to state a shipping time. If you do, the FTC says it must be stated clearly and conspicuously, and it becomes your deadline. “Ships in 2 business days” on a product page is a promise the rule holds you to. A seller with no stated time has 30 days. A seller who wrote “ships next day” has one.

That is worth remembering when you write listing copy. An optimistic handling time attracts buyers, but it shortens the legal deadline along with the marketplace one.

What to do when you cannot ship on time

The FTC’s guide sets out the delay procedure in detail. In short:

  1. Send a delay notice as soon as you know, and no later than the original deadline. The notice can go by email, phone, fax or mail. A note on an order status page alone is not enough if the buyer may not see it in time.
  2. Give a new date or say you have none. The notice must include a definite revised shipping date, or say that you cannot provide one and give the reason for the delay.
  3. Offer a free way to cancel. The buyer must be able to cancel at your expense and get a prompt refund.
  4. Read silence correctly. If your revised date is 30 days or less after the original, you may treat no reply as agreement to wait, and the notice must say so. If the revised date is more than 30 days after the original deadline, or you cannot give a date, the notice must say the order will be cancelled automatically unless one of two things happens within 30 days of the original deadline: you ship and the buyer has not cancelled, or the buyer expressly agrees to the delay (16 CFR 435.2(b)(1)(iii)). Consent that arrives after those 30 days does not save the order. A buyer who agrees to an indefinite delay keeps the right to cancel at any time before you ship, and the notice must say that too.
  5. On a second delay, silence means cancel. A renewed notice is required before the revised date passes. This time, the FTC says the customer’s silence may not be treated as consent. Without the buyer’s agreement, you cancel and refund.

You must also cancel and refund when the buyer cancels before you ship, or when you decide you will never be able to ship the item.

What a refund has to include

When nothing has shipped, the FTC says the refund is the entire amount the customer paid, including shipping, handling and insurance. For most payment methods the refund is due within seven working days of the cancellation. If the buyer paid with credit you issued yourself, the account must be corrected within one billing cycle.

If someone else ships for you

Using a drop-shipper or a fulfillment service does not move the duty. The FTC’s guide says the person who solicits the order is the seller, and the seller is liable for violations caused by a fulfillment house or drop-shipper. If your supplier ships late, the delay notice and the refund are still yours to send.

The records that protect you

“Reasonable basis” is the phrase the rule turns on. The FTC describes it as the information that would satisfy a reasonable and prudent businessperson, and it names the kind of evidence that counts: anticipated demand, inventory or supply sources, fulfillment capacity, and order records. The guide also warns that a seller without records is presumed not to have had a reasonable basis.

For a small shop, that comes down to a short list:

  • Stock counts that show you had the item, or a supplier’s commitment that you would.
  • Order records with the date each properly completed order came in.
  • Proof of the handoff for each order: the label record and the carrier’s first scan. What a tracking number proves covers which scan shows what.
  • Copies of any delay notices you sent and the buyers’ replies.

What it costs to ignore

The FTC can seek civil penalties for violations. Its guide gives the figure as up to $53,088 per violation, as updated in January 2025. For a small seller the nearer costs are the refunds themselves, which include the shipping the buyer paid, and whatever penalties a marketplace applies for late shipment.

Marketplaces set shorter clocks

The FTC rule is the floor. Marketplaces set their own deadlines on top of it, and they can be much shorter. TikTok Shop, for example, requires a regular order to be scanned by a carrier within 2 business days (TikTok Shop Fulfillment Policy, dated September 28, 2026).

Sources

16 CFR Part 435, Mail, Internet, or Telephone Order Merchandise (eCFR); FTC, “Business Guide to the FTC’s Mail, Internet, or Telephone Order Merchandise Rule” (edited January 2025); TikTok Shop Fulfillment Policy, dated September 28, 2026. All checked October 12, 2026.