Senate Bill Requires Transparency About High-Volume, Third-Party Sellers On Online Marketplaces

A bipartisan team has introduced a bill to require transparency on the part of bulk third-party sellers on online retail marketplaces. 

The Integrity, Notification, and Fairness in Online Retail Marketplaces for Consumers (INFORM Consumers) Act was fielded this week by Senators Dick Durbin (D-IL) and Bill Cassidy, M.D. (R-LA). 

It would fight the sale of counterfeit goods online, while mandating that online marketplaces authenticate and reveal the identity of high-volume retail sellers, the authors claim. 

The bill is co-sponsored by Senators Chuck Grassley (R-IA), Mazie K. Hirono (D-HI), Chris Coons (D-DE), and Thom Tillis (R-NC).

The legislation mandates that online marketplaces ensure their high-volume third-party sellers disclose basic information to consumers, including the seller’s name, business address, email address and phone number.

But it would allow sellers that field reasonably fast email responses to consumer queries to avoid having their own email addresses and other information revealed. 

The bill defines high-volume sellers as those that have made 200 or more discrete sales in a 12-month period totaling at least $5,000.

Marketplaces would also have to gather such sellers’ government ID, tax ID and bank account information, and contact information. 

It is not clear what the prospects are for the INFORM Consumers Act in this legislative season. But Republicans and Democrats seem to agree on it. 

“People deserve to know basic information about those who sell them consumer products online,” Durbin states. “Our bill ensures a baseline level of transparency for online marketplaces, where currently it may be difficult to know who third-party sellers are and how to contact them.”

Cassidy adds, “Criminal organizations are attempting to trick consumers into buying counterfeit and hazardous products online. This bipartisan bill provides transparency and necessary information for consumers to distinguish between genuine retailers and frauds in the internet marketplace.”

Tillis charges that “criminal actors, often from China, are taking advantage of this pandemic to sell dangerous counterfeit goods to unsuspecting Americans.”

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