Popular retail stores are telling distributors and wholesalers to stop selling products online if they have the same in their stores, claims eBay in response to an inquiry into the current situation within the Australian retail industry.

The strong allegation comes as the Productivity Commission proceeds to hear more evidence from retailers and peak-body groups into the competitive pressures to which traditional retailers are being subjected, as the popularity of online shopping sites such as Amazon and eBay continue to escalate.

Responding to draft recommendations released by the Productivity Commission last month, eBay managing director (Australia and New Zealand) Deborah Sharkey alleged on Monday that certain unidentified Australian retailers had taken an anti-competitive approach to block the availability of products at online sites.

eBay urges the Australian Competition and Consumer Commission to further investigate the alleged pressure on distributors and wholesalers, noting that restrictive distribution practices is aimed at systematically crushing online stores.

"eBay is also aware of situations where local distributors and sellers have had pressure applied by prominent Australian retailers to cease selling products on online sites such as eBay.com.au, in competition to the retailer's own channels," Sharkey said in her statement.

"The highly concentrated Australian retail environment means such behaviour can create considerable pressure on distributors and sellers, who have limited other retail distribution channels locally."

"eBay is pleased that the Commission has referred concerns relating to restrictive distribution practices to the ACCC and considers that there is merit in more in-depth study by the ACCC into the effect on consumer choice and online retailing of restrictive distribution practices by some traditional retailers, manufacturers and suppliers."

Sharkey argued that the blockages born from such unfair distribution practices combined with other factors that delay traditional domestic retailers from launching online sales channels resulted in a poor domestic product range and supply in online shops.

"This frustrates their capacity to support Australian retailers and drives their spending offshore where product range is superior, and online shopping is more advanced and consumer-friendly.

"It appears that restrictive distribution practices may be a significant barrier to competition, to growing ecommerce in Australia and to modernising the Australian retail industry in line with other advanced countries... This warrants further attention by the ACCC and eBay considers it important that the results of the ACCC's investigation be factored into any proposed policy reform," Sharkey said.

Meanwhile, the executive director of the Australian Retailers Association, Russell Zimmerman, said on Monday that shop workers' penalty rates should be cut to help retailers compete in an increasingly tough market.