Yahoo is shutting six European auction sites leaving the ground clear for rival eBay.
The move, which is an attempt by Yahoo to improve its profitability after a slump in online advertising, is part of a marketing deal with eBay.
Under the deal, eBay will place banner advertisements, text links and other online advertising tools on Yahoo.
Yahoo has announced that it will stop accepting new listings for its auction sites within the next two weeks in Germany, the UK, France, Spain, Italy and Ireland.
eBay will be named and featured as the preferred online auction service on Yahoo in the six countries.
Yahoo's other auction operations in Europe will be unaffected.
The move is likely to prove that auction sites have not been profitable for anyone but eBay.
eBay has 46 million users worldwide and has been doing well in Germany and the UK, and said its European businesses are growing overall between 35 and 40 per cent a quarter.
Yahoo said it would continue running auctions on its US sites and that there would be no job losses.
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