Cut outs in CD cases are very common and are known as “cut out titles” in the music industry.
Cuts are snipped on the spine of the CD jewel cases to denote overstock or unsold inventory from the record labels. These cut CDs are typically sent to distributors all across the world and then sold through various discount channels such as Walmart and online channels.
As digital forecasting technology approved over time, around 2001 and beyond, record labels were better able to predict how many CDs would be needed to product and thus cutting down on wasteful production overruns.
If you run across CD’s today doing retail arbitrage then they are most likely CDs produced before 2003.
In addition to overstock, CDs with punch holes or slits could and often are factory sealed from the distributor or record label and were sent out as promotional CDs to record stores and radio stations.
Can I sell these CD’s on Amazon?
Yes….and no….and maybe so….
According to Amazon:
Note that CD cases or liner notes that have a hole punched through the UPC code, or have the UPC code marked out, are usually promotional versions and may not be sold on Amazon.com
So it would seem that CDs where the UPC code has been “punched through” and no longer scannable are not permitted.
No mention is made to cut outs or slits in the CD spine of the jewel case. Most sellers performing retail arbitrage swap out the clear plastic jewel case and the black tray insert so these CD cut outs wouldn’t even be present at the time you sent them into the Amazon warehouse.
Some rules are not very clear when it comes to what you can and can’t do on Amazon but most sellers we know avoid sending in the hole punched CDs and swap out the cases with the slits.