INFORM Consumers Act

II 116TH CONGRESS 2D SESSION S. 3431 To require online marketplaces to disclose certain verified information regard- ing high-volume third party sellers of consumer products to inform con- sumers. IN THE SENATE OF THE UNITED STATES MARCH 10, 2020 Mr. CASSIDY (for himself, Mr. DURBIN, and Mr. PERDUE) introduced the fol- lowing bill; which was read twice and referred to the Committee on Com- merce, Science, and Transportation A BILL To require online marketplaces to disclose certain verified 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 22:00 Mar 13, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S3431.IS S3431 kjohnson on DSK79L0C42PROD with BILLS 2 •S 3431 IS SEC. 2. DISCLOSURE OF INFORMATION BY ONLINE MAR- 1 KETPLACES TO INFORM CONSUMERS. 2 (a) VERIFICATION REQUIRED.—Any online market- 3 place shall verify, on an annual basis, the identity of any 4 high-volume third party seller on the online marketplace 5 by requiring the high-volume third party seller to provide, 6 on at least an annual basis, the following information: 7 (1) Verified bank account information. 8 (2) A government-issued photo identification for 9 an individual representing the high-volume third 10 party seller. 11 (3) A government-issued record verifying the in- 12 dividual or business contact information. 13 (4) A business tax identification number. 14 (b) INFORMATION REQUIRED.— 15 (1) IN GENERAL.—Any online marketplace shall 16 require a high-volume third party seller on the on- 17 line marketplace to provide, and shall disclose to 18 consumers in a conspicuous manner on the product 19 listing or through a conspicuously placed link on the 20 product listing, the following information: 21 (A) Subject to paragraph (2), the identity 22 of the high-volume third party seller which shall 23 include— 24 (i) the full name of the seller; 25 VerDate Sep 11 2014 22:00 Mar 13, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S3431.IS S3431 kjohnson on DSK79L0C42PROD with BILLS 3 •S 3431 IS (ii) the full business address of the 1 seller; 2 (iii) whether the seller engages in the 3 manufacturing, importing, retail, or resell- 4 ing of consumer products; and 5 (iv) contact information for the seller, 6 including a phone number and working 7 email address. 8 (B) Contact information that allows for re- 9 porting of suspicious marketplace activity to the 10 online marketplace and a message encouraging 11 individuals seeking goods for purchase to report 12 suspicious activity to the online marketplace. 13 (C) Any other information that the Com- 14 mission determines to be necessary to address 15 circumvention or evasion of the requirements of 16 this paragraph, provided that the additional in- 17 formation is limited to what is necessary to ad- 18 dress such circumvention or evasion. 19 (2) EXCEPTION.— 20 (A) IN GENERAL.—Subject to subpara- 21 graph (B), upon the request of a high-volume 22 third party seller, an online marketplace may 23 provide for partial disclosure of the identity in- 24 VerDate Sep 11 2014 22:00 Mar 13, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S3431.IS S3431 kjohnson on DSK79L0C42PROD with BILLS 4 •S 3431 IS formation required under paragraph (1)(A) in 1 the following situations: 2 (i) If the high-volume third party sell- 3 er demonstrates to the online marketplace 4 that the seller does not have a business ad- 5 dress and only has a personal street ad- 6 dress, the online marketplace may direct 7 the high-volume third-party seller to dis- 8 close only the country and, if applicable, 9 the State in which the high-volume third- 10 party seller resides on the product listing, 11 and may inform consumers that there is no 12 business address available for the seller 13 and that consumer inquiries should be sub- 14 mitted to the seller’s email address. 15 (ii) If a high-volume third party seller 16 demonstrates to the online marketplace 17 that the seller does not have a phone num- 18 ber other than a personal phone number, 19 the online marketplace may inform con- 20 sumers that there is no phone number 21 available for the seller and that consumer 22 inquiries should be submitted to the sell- 23 er’s email address. 24 VerDate Sep 11 2014 22:00 Mar 13, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S3431.IS S3431 kjohnson on DSK79L0C42PROD with BILLS 5 •S 3431 IS (B) LIMITATION ON EXCEPTION.—If an 1 online marketplace becomes aware that a high- 2 volume third party seller has made a false rep- 3 resentation to the online marketplace in order 4 to justify the provision of a partial disclosure 5 under subparagraph (A) or that a high-volume 6 third party seller who has requested and re- 7 ceived a provision for a partial disclosure under 8 subparagraph (A) has not provided responsive 9 answers within a reasonable timeframe to con- 10 sumer inquiries submitted to the seller’s email 11 address, the online marketplace shall withdraw 12 its provision for partial disclosure and require 13 the full disclosure of the high-volume third 14 party seller’s identity information required 15 under paragraph (1)(A) upon three business 16 days’ notice to the high-volume third party sell- 17 er. 18 (c) FULFILLMENT OR SHIPMENT BY DIFFERENT 19 PARTY THAN SELLER.—In addition to the requirements 20 of subsection (b), an online marketplace that warehouses, 21 distributes, or otherwise fulfills a consumer product order 22 shall disclose to the consumer the identification of any 23 high-volume third party seller supplying the consumer 24 VerDate Sep 11 2014 22:00 Mar 13, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S3431.IS S3431 kjohnson on DSK79L0C42PROD with BILLS 6 •S 3431 IS product if different than the seller listed on the product 1 listing page. 2 (d) ENFORCEMENT.— 3 (1) UNFAIR AND DECEPTIVE ACTS OR PRAC- 4 TICES.—A violation of subsection (a), (b), or (c) 5 shall be treated as a violation of a rule defining an 6 unfair or deceptive act or practice prescribed under 7 section 18(a)(1)(B) of the Federal Trade Commis- 8 sion Act (15 U.S.C. 57a(a)(1)(B)). 9 (2) POWERS OF THE COMMISSION.— 10 (A) IN GENERAL.—The Commission shall 11 enforce this Act in the same manner, by the 12 same means, and with the same jurisdiction, 13 powers, and duties as though all applicable 14 terms and provisions of the Federal Trade 15 Commission Act (15 U.S.C. 41 et seq.) were in- 16 corporated into and made a part of this Act. 17 (B) PRIVILEGES AND IMMUNITIES.—Any 18 person that violates subsection (a), (b), or (c) 19 shall be subject to the penalties, and entitled to 20 the privileges and immunities, provided in the 21 Federal Trade Commission Act (15 U.S.C. 41 22 et seq.). 23 (3) REGULATIONS.—The Federal Trade Com- 24 mission may promulgate regulations under section 25 VerDate Sep 11 2014 22:00 Mar 13, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S3431.IS S3431 kjohnson on DSK79L0C42PROD with BILLS 7 •S 3431 IS 553 of title 5, United States Code, as necessary with 1 respect to collecting and verifying information under 2 this section. 3 (4) AUTHORITY PRESERVED.—Nothing in this 4 Act shall be construed to limit the authority of the 5 Commission under any other provision of law. 6 (e) DEFINITIONS.—In this Act: 7 (1) COMMISSION.—The term ‘‘Commission’’ 8 means the Federal Trade Commission. 9 (2) CONSUMER PRODUCT.—The term ‘‘con- 10 sumer product’’ means any tangible personal prop- 11 erty which is distributed in commerce and which is 12 normally used for personal, family, or household 13 purposes (including any such property intended to 14 be attached to or installed in any real property with- 15 out regard to whether it is so attached or installed). 16 (3) HIGH-VOLUME THIRD PARTY SELLER.—The 17 term ‘‘high-volume third party seller’’ means a user 18 of an online marketplace who is a third party seller 19 and who, in any continuous 12-month period during 20 the previous 24 months, has entered into 200 or 21 more discrete sales or transactions of new or unused 22 consumer products resulting in the accumulation of 23 an aggregate total of $5,000 or more in gross reve- 24 nues. 25 VerDate Sep 11 2014 22:00 Mar 13, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S3431.IS S3431 kjohnson on DSK79L0C42PROD with BILLS 8 •S 3431 IS (4) ONLINE MARKETPLACE.—The term ‘‘online 1 marketplace’’ means any electronically based or 2 accessed platform that— 3 (A) includes features that allow for, facili- 4 tate, or enable third party sellers to engage in 5 the sale, purchase, payment, storage, shipping, 6 or delivery of a consumer product in the United 7 States; and 8 (B) hosts one or more third party sellers. 9 (5) SELLER.—The term ‘‘seller’’ means a per- 10 son who sells, offers to sell, or contracts to sell a 11 consumer product through an online marketplace. 12 (6) THIRD PARTY SELLER.— 13 (A) IN GENERAL.—The term ‘‘third party 14 seller’’ means any seller, independent of an op- 15 erator, facilitator, or owner of an online mar- 16 ketplace, who sells, offers to sell, or contracts to 17 sell a consumer product in the United States 18 through an online marketplace. 19 (B) EXCLUSION.—The term ‘‘third party 20 seller’’ does not include a seller who— 21 (i) is a business entity that has made 22 available to the general public the entity’s 23 name, business address, and working con- 24 tact information; 25 VerDate Sep 11 2014 22:00 Mar 13, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S3431.IS S3431 kjohnson on DSK79L0C42PROD with BILLS 9 •S 3431 IS (ii) has an ongoing contractual rela- 1 tionship with the owner of the online mar- 2 ketplace to provide for the manufacture, 3 distribution, wholesaling, or fulfillment of 4 shipments of consumer products; and 5 (iii) has provided to the owner of the 6 online marketplace identifying information, 7 as described in subsection (a), that has 8 been verified by the owner. 9 (7) VERIFY.—The term ‘‘verify’’ means to con- 10 firm a marketplace seller’s personal identifiable in- 11 formation by the use of an approved third party 12 identity verification system that has the capability to 13 confirm a seller’s name, email address, physical ad- 14 dress, and phone number, or through the use of a 15 combination of two-factor authentication, public 16 records search, and the presentation of a govern- 17 ment-issued identification. 18 SEC. 3. OTHER AUTHORITIES. 19 Nothing in this Act shall be construed to limit or oth- 20 erwise affect any other Federal authority, rule, regulation, 21 or standard that applies to consumer products, including 22 the provisions of section 230 of the Communications Act 23 of 1934 (47 U.S.C. 230) as such provisions apply to an 24 online marketplace. 25 VerDate Sep 11 2014 22:00 Mar 13, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S3431.IS S3431 kjohnson on DSK79L0C42PROD with BILLS 10 •S 3431 IS SEC. 4. EFFECTIVE DATE. 1 This Act shall take effect 180 days after the date of 2 the enactment of this Act. 3 Æ VerDate Sep 11 2014 22:00 Mar 13, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6301 E:\BILLS\S3431.IS S3431 kjohnson on DSK79L0C42PROD with BILLS