INFORM Consumers Act

II 117TH CONGRESS 1ST SESSION S. 936 To require online marketplaces to collect, verify, and disclose certain informa- tion regarding high-volume third party sellers of consumer products to inform consumers. IN THE SENATE OF THE UNITED STATES MARCH 23, 2021 Mr. DURBIN (for himself, Mr. CASSIDY, Mr. GRASSLEY, Ms. HIRONO, Mr. COONS, and Mr. TILLIS) introduced the following bill; which was read twice and referred to the Committee on Commerce, Science, and Trans- portation A BILL To require online marketplaces to collect, verify, and disclose certain information regarding high-volume third party sellers of consumer products to inform consumers. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Integrity, Notification, 4 and Fairness in Online Retail Marketplaces for Con- 5 sumers Act’’ or the ‘‘INFORM Consumers Act’’. 6 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 2 •S 936 IS SEC. 2. COLLECTION, VERIFICATION, AND DISCLOSURE OF 1 INFORMATION BY ONLINE MARKETPLACES 2 TO INFORM CONSUMERS. 3 (a) COLLECTION AND VERIFICATION OF INFORMA- 4 TION.— 5 (1) COLLECTION.— 6 (A) IN GENERAL.—An online marketplace 7 shall require any high-volume third party seller 8 on such online marketplace’s platform to pro- 9 vide, not later than 2 business days after quali- 10 fying as a high-volume third party seller on the 11 platform, the following information to the on- 12 line marketplace: 13 (i) BANK ACCOUNT.— 14 (I) IN GENERAL.—A bank ac- 15 count number, or, if such seller does 16 not have a bank account, the name of 17 the payee for payments issued by the 18 online marketplace to such seller. 19 (II) PROVISION OF INFORMA- 20 TION.—The bank account or payee in- 21 formation required under subclause 22 (I) may be provided by the seller in 23 the following ways: 24 (aa) To the online market- 25 place. 26 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 3 •S 936 IS (bb) To a payment processor 1 or other third party contracted 2 by the online marketplace to 3 maintain such information, pro- 4 vided that the online marketplace 5 ensures that it can obtain such 6 information on demand from 7 such payment processor or other 8 third party. 9 (ii) CONTACT INFORMATION.—Contact 10 information for such seller as follows: 11 (I) With respect to a high-volume 12 third party seller that is an individual, 13 a copy of a valid government-issued 14 identification for the individual that 15 includes the individual’s name and 16 physical address. 17 (II) With respect to a high-vol- 18 ume third party seller that is not an 19 individual, one of the following forms 20 of contact information: 21 (aa) A copy of a valid gov- 22 ernment-issued identification for 23 an individual acting on behalf of 24 such seller that includes the indi- 25 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 4 •S 936 IS vidual’s name and physical ad- 1 dress. 2 (bb) A copy of a valid gov- 3 ernment-issued record or tax doc- 4 ument that includes the business 5 name and physical address of 6 such seller. 7 (iii) TAX ID.—A business tax identi- 8 fication number, or, if such seller does not 9 have a business tax identification number, 10 a taxpayer identification number. 11 (iv) WORKING EMAIL AND PHONE 12 NUMBER.—A current working email ad- 13 dress and phone number for such seller. 14 (B) NOTIFICATION OF CHANGE; ANNUAL 15 CERTIFICATION.— 16 (i) IN GENERAL.—An online market- 17 place shall require any high-volume third 18 party seller on such online marketplace’s 19 platform to promptly notify the online 20 marketplace of any change to the informa- 21 tion collected under subparagraph (A). 22 (ii) ANNUAL CERTIFICATION.—Not 23 later than 1 year after the date of enact- 24 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 5 •S 936 IS ment of this Act and annually thereafter, 1 an online marketplace shall— 2 (I) inform any high-volume third 3 party seller on such online market- 4 place’s platform of the notification re- 5 quirement described in clause (i); and 6 (II) instruct any such seller to 7 electronically certify, not later than 3 8 business days after receiving such in- 9 struction, that— 10 (aa) there have been no 11 changes to such seller’s informa- 12 tion; or 13 (bb) such seller has provided 14 any changes to such information 15 to the online marketplace. 16 (iii) SUSPENSION.—In the event that 17 an online marketplace does not receive the 18 annual certification from a high-volume 19 third party seller required under clause 20 (ii), the online marketplace shall suspend 21 any future sales activity of such seller or 22 any payments to such seller for prior sales 23 activity until such seller provides such cer- 24 tification. 25 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 6 •S 936 IS (2) VERIFICATION.— 1 (A) IN GENERAL.—An online marketplace 2 shall— 3 (i) verify the information collected 4 under paragraph (1)(A) not later than 3 5 business days after such collection; and 6 (ii) verify any change to such informa- 7 tion not later than 3 business days after 8 being notified of such change by a high- 9 volume third party seller under paragraph 10 (1)(B). 11 (B) PRESUMPTION OF VERIFICATION.—In 12 the case of a high-volume third party seller that 13 provides a copy of a valid government-issued 14 tax document, any information contained in 15 such document shall be presumed to be verified 16 as of the date of issuance of such document. 17 (b) DISCLOSURE REQUIRED.— 18 (1) REQUIREMENT.— 19 (A) IN GENERAL.—An online marketplace 20 shall— 21 (i) require any high-volume third 22 party seller on such online marketplace’s 23 platform to provide the information de- 24 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 7 •S 936 IS scribed in subparagraph (B) to the online 1 marketplace; and 2 (ii) disclose the information described 3 in subparagraph (B) to consumers in a 4 clear and conspicuous manner on the prod- 5 uct listing or (for information other than 6 such seller’s identification) through a clear 7 and conspicuously placed link on the prod- 8 uct listing or in close proximity to the 9 physical product. 10 (B) INFORMATION DESCRIBED.—The in- 11 formation described in this subparagraph is the 12 following: 13 (i) Subject to paragraph (2), the iden- 14 tity of the high-volume third party seller, 15 including— 16 (I) the full name of the seller; 17 (II) the physical address of the 18 seller; 19 (III) whether the seller also en- 20 gages in the manufacturing, import- 21 ing, or reselling of consumer products; 22 and 23 (IV) contact information for the 24 seller, including— 25 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 8 •S 936 IS (aa) a current working 1 phone number; and 2 (bb) a current working email 3 address or other means of elec- 4 tronic messaging (which may be 5 provided to such seller by the on- 6 line marketplace). 7 (ii) The identification of any seller 8 that supplies the consumer product to the 9 consumer upon purchase, if such seller is 10 different than the high-volume third party 11 seller listed on the product listing prior to 12 purchase. 13 (2) EXCEPTION.— 14 (A) IN GENERAL.—Subject to subpara- 15 graph (B), upon the request of a high-volume 16 third party seller, an online marketplace may 17 provide for partial disclosure of the identity in- 18 formation required under paragraph (1)(B)(i) 19 in the following situations: 20 (i) If such seller certifies to the online 21 marketplace that the seller does not have 22 a business address and only has a residen- 23 tial street address, the online marketplace 24 may— 25 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 9 •S 936 IS (I) disclose only the country and, 1 if applicable, the State in which such 2 seller resides; and 3 (II) inform consumers that there 4 is no business address available for 5 the seller and that consumer inquiries 6 should be submitted to the seller by 7 phone, email, or other means of elec- 8 tronic messaging provided to such 9 seller by the online marketplace. 10 (ii) If such seller certifies to the online 11 marketplace that the seller is a business 12 that has a physical address for product re- 13 turns, the online marketplace may disclose 14 the seller’s physical address for product re- 15 turns. 16 (iii) If such seller certifies to the on- 17 line marketplace that the seller does not 18 have a phone number other than a per- 19 sonal phone number, the online market- 20 place shall inform consumers that there is 21 no phone number available for the seller 22 and that consumer inquiries should be sub- 23 mitted to the seller’s email address or 24 other means of electronic messaging pro- 25 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 10 •S 936 IS vided to such seller by the online market- 1 place. 2 (B) LIMITATION ON EXCEPTION.—If an 3 online marketplace becomes aware that a high- 4 volume third party seller has made a false rep- 5 resentation to the online marketplace in order 6 to justify the provision of a partial disclosure 7 under subparagraph (A) or that a high-volume 8 third party seller who has requested and re- 9 ceived a provision for a partial disclosure under 10 subparagraph (A) has not provided responsive 11 answers within a reasonable time frame to con- 12 sumer inquiries submitted to the seller by 13 phone, email, or other means of electronic mes- 14 saging provided to such seller by the online 15 marketplace, the online marketplace shall sus- 16 pend the selling privileges of such seller unless 17 such seller consents to the disclosure of the 18 identity information required under paragraph 19 (1)(B)(i). 20 (3) REPORTING MECHANISM.—An online mar- 21 ketplace shall disclose to consumers in a clear and 22 conspicuous manner on the product listing of any 23 high-volume third party seller— 24 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 11 •S 936 IS (A) a reporting mechanism that allows for 1 electronic and telephonic reporting of suspicious 2 marketplace activity to the online marketplace; 3 and 4 (B) a message encouraging consumers 5 seeking goods for purchase to report suspicious 6 marketplace activity to the online marketplace. 7 (4) COMPLIANCE.—If a high-volume third party 8 seller does not comply with the requirements to pro- 9 vide and disclose information under this subsection, 10 the online marketplace shall suspend any future 11 sales activity of such seller or any payments to such 12 seller for prior sales activity until such seller com- 13 plies with such requirements. 14 (c) ENFORCEMENT.— 15 (1) UNFAIR AND DECEPTIVE ACTS OR PRAC- 16 TICES.—A violation of subsection (a) or (b) by an 17 online marketplace shall be treated as a violation of 18 a rule defining an unfair or deceptive act or practice 19 prescribed under section 18(a)(1)(B) of the Federal 20 Trade Commission Act (15 U.S.C. 57a(a)(1)(B)). 21 (2) POWERS OF THE COMMISSION.— 22 (A) IN GENERAL.—The Commission shall 23 enforce this Act in the same manner, by the 24 same means, and with the same jurisdiction, 25 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 12 •S 936 IS powers, and duties as though all applicable 1 terms and provisions of the Federal Trade 2 Commission Act (15 U.S.C. 41 et seq.) were in- 3 corporated into and made a part of this Act. 4 (B) PRIVILEGES AND IMMUNITIES.—Any 5 person that violates subsection (a) or (b) shall 6 be subject to the penalties, and entitled to the 7 privileges and immunities, provided in the Fed- 8 eral Trade Commission Act (15 U.S.C. 41 et 9 seq.). 10 (3) REGULATIONS.—The Commission may pro- 11 mulgate regulations under section 553 of title 5, 12 United States Code, with respect to the collection, 13 verification, or disclosure of information under this 14 section, provided that such regulations are limited to 15 what is necessary to collect, verify, and disclose such 16 information. 17 (4) AUTHORITY PRESERVED.—Nothing in this 18 Act shall be construed to limit the authority of the 19 Commission under any other provision of law. 20 (d) SEVERABILITY.—If any provision of this section, 21 or the application thereof to any person or circumstance, 22 is held invalid, the remainder of this section and the appli- 23 cation of such provision to other persons not similarly situ- 24 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with BILLS 13 •S 936 IS ated or to other circumstances shall not be affected by 1 the invalidation. 2 (e) DEFINITIONS.—In this Act: 3 (1) COMMISSION.—The term ‘‘Commission’’ 4 means the Federal Trade Commission. 5 (2) CONSUMER PRODUCT.—The term ‘‘con- 6 sumer product’’ has the meaning given such term in 7 section 101 of the Magnuson-Moss Warranty—Fed- 8 eral Trade Commission Improvement Act (15 U.S.C. 9 2301 note) and section 700.1 of title 16, Code of 10 Federal Regulations. 11 (3) HIGH-VOLUME THIRD PARTY SELLER.—The 12 term ‘‘high-volume third party seller’’ means a par- 13 ticipant on an online marketplace’s platform who is 14 a third party seller and who, in any continuous 12- 15 month period during the previous 24 months, has 16 entered into 200 or more discrete sales or trans- 17 actions of new or unused consumer products result- 18 ing in the accumulation of an aggregate total of 19 $5,000 or more in gross revenues. 20 (4) ONLINE MARKETPLACE.—The term ‘‘online 21 marketplace’’ means any person or entity that oper- 22 ates an electronically based or accessed platform 23 that— 24 VerDate Sep 11 2014 04:42 Apr 14, 2021 Jkt 019200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\S936.IS S936 pbinns on DSKJLVW7X2PROD with [Text truncated for display. 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