  The importance of three-body dynamics in the $\eta np$ system in elastic and
inelastic $\eta$-deuteron scattering as well as coherent and incoherent $\eta$
photoproduction on the deuteron in the energy region from threshold up to 30
MeV above has been investigated. It is shown that a restriction to first order
rescattering with respect to the $NN$- and $\eta N$-final state interactions,
i.e., restriction to rescattering in the two-body subsystems, does not give a
sufficiently accurate approximation to the s-wave reaction amplitude and that
higher order terms, as described by the three-body dynamics give very
substantial contributions.
