Hi
The following steps may help:
If you have not yet done so, unpair your watch from within the Watch app on your iPhone:
- On your iPhone, in the Watch app, go to: My Watch (tab) > tap on the name of the watch (at the top) > tap on the "i" icon next to the watch > if the button is shown, tap on Unpair Apple Watch and follow the further instructions.
- Unpair your Apple Watch and iPhone - Apple Support
If the Apple Watch has already been erased directly from the watch, then remove it from Find My iPhone online:
- On a computer, in a web browser, go to: https://www.iCloud.com > sign in with your Apple ID.
- Open Find iPhone > select All Devices (at the top) > click your Apple Watch.
- Click Erase Apple Watch > Select Next until the device is erased.
- Click "X" next to your Apple Watch.
Having followed the previous steps, ask the buyer to follow these:
- On their iPhone: close the Watch app (double-press on the Home button, then swipe up on the Watch app preview).
- Restart both their iPhone and the watch, turning both off together, then restarting their iPhone first:
- Re-try pairing and setting up their watch:
If the watch remains locked with Activation Lock, then pair it with your own iPhone again > unpair it via the Watch app (which erases the watch and also removes Activation Lock) > return it to the buyer:
More information: