Online auction giant TradeMe has been accused of bullying tactics after serving a copyright infringement notice to a fledgling rival.

Henry Aung, owner-operator of trading website lixtor.co.nz, has been accused of copyright breaches in Lixtor’s terms and conditions and privacy policy, which TradeMe claims are copies of its own policies.

Mr Aung says the allegations are wrong, and just an attempt to try to “intimidate” a small competitor.

He says not-for-profit organisation Truste wrote Lixtor’s privacy policy, and that it is not surprising there are similarities to TradeMe’s terms and conditions when both are auction sites and cover similar topics.

“This is just TradeMe getting threatened by Lixtor and trying to shut Lixtor down by intimidation,” says Mr Aung.

TradeMe spokesman Mike O’Donnell says Lixtor’s alleged copyright breach is nothing new for TradeMe.

“What happens is websites set up and they say, ‘we need a privacy policy, we need terms and conditions, what’s a good website to use? I know, TradeMe’, and they’ll copy and paste our terms and conditions and privacy policy onto their site.”

But Mr Aung says TradeMe is worried about Lixtor, not because of his website’s size but its business model, which doesn’t charge users for auction services.

He uses the example of his friend, who pays thousands a month in TradeMe fees, as someone who could be wooed by Lixtor’s no-fee system.

“It comes down to a choice –  pay money or don’t pay money,” says Mr Aung.

However, Mr O’Donnell says Lixtor’s complaint is a common tactic used by small companies to generate publicity.

“Small start-up businesses like this one go to the media periodically to try to draw attention to their auction websites,” he says.

The copied parts are fairly obvious when you compare the documents from both sites, according to Mr O’Donnell.

“From our point of view it seemed a straightforward example of copyright material.

"Subsequently Lixtor has changed some material since we wrote to them on October 22, which to me seems like tacit acceptance that they have breached copyright."