[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5502 Engrossed in House (EH)]
<DOC>
117th CONGRESS
2d Session
H. R. 5502
_______________________________________________________________________
AN ACT
To require online marketplaces to verify certain information regarding
high-volume third party sellers of consumer products on such online
marketplaces and to disclose to consumers certain contact and other
information regarding such high-volume third party sellers.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Integrity, Notification, and
Fairness in Online Retail Marketplaces for Consumers Act'' or the
``INFORM Consumers Act''.
SEC. 2. COLLECTION, VERIFICATION, AND DISCLOSURE OF INFORMATION BY
ONLINE MARKETPLACES TO INFORM CONSUMERS.
(a) Collection and Verification of Information.--
(1) Collection.--
(A) In general.--An online marketplace shall
require any high-volume third party seller on such
online marketplace's platform to provide, not later
than 10 days after qualifying as a high-volume third
party seller on the platform, the following information
to the online marketplace:
(i) Bank account.--
(I) In general.--A bank account
number, or, if such seller does not
have a bank account, the name of the
payee for payments issued by the online
marketplace to such seller.
(II) Provision of information.--The
bank account or payee information
required under subclause (I) may be
provided by the seller in the following
ways:
(aa) To the online
marketplace.
(bb) To a payment processor
or other third party contracted
by the online marketplace to
maintain such information,
provided that the online
marketplace ensures that it can
obtain such information within
3 business days from such
payment processor or other
third party.
(ii) Contact information.--Contact
information for such seller as follows:
(I) With respect to a high-volume
third party seller that is an
individual, the individual's name.
(II) With respect to a high-volume
third party seller that is not an
individual, one of the following forms
of contact information:
(aa) A copy of a valid
government-issued
identification for an
individual acting on behalf of
such seller that includes the
individual's name.
(bb) A copy of a valid
government-issued record or tax
document that includes the
business name and physical
address of such seller.
(iii) Tax id.--A business tax
identification number, or, if such seller does
not have a business tax identification number,
a taxpayer identification number.
(iv) Working email and phone number.--A
current working email address and phone number
for such seller.
(B) Notification of change; annual certification.--
An online marketplace shall--
(i) periodically, but not less than
annually, notify any high-volume third party
seller on such online marketplace's platform of
the requirement to keep any information
collected under subparagraph (A) current; and
(ii) require any high-volume third party
seller on such online marketplace's platform
to, not later than 10 days after receiving the
notice under clause (i), electronically certify
that--
(I) the seller has provided any
changes to such information to the
online marketplace, if any such changes
have occurred; or
(II) there have been no changes to
such seller's information.
(C) Suspension.--In the event that a high-volume
third party seller does not provide the information or
certification required under this paragraph, the online
marketplace shall, after providing the seller with
written or electronic notice and an opportunity to
provide such information or certification not later
than 10 days after the issuance of such notice, suspend
any future sales activity of such seller until such
seller provides such information or certification.
(2) Verification.--
(A) In general.--An online marketplace shall--
(i) verify the information collected under
paragraph (1)(A) not later than 10 days after
such collection; and
(ii) verify any change to such information
not later than 10 days after being notified of
such change by a high-volume third party seller
under paragraph (1)(B).
(B) Presumption of verification.--In the case of a
high-volume third party seller that provides a copy of
a valid government-issued tax document, any information
contained in such document shall be presumed to be
verified as of the date of issuance of such document.
(3) Data use limitation.--Data collected solely to comply
with the requirements of this section may not be used for any
other purpose unless required by law.
(4) Data security requirement.--An online marketplace shall
implement and maintain reasonable security procedures and
practices, including administrative, physical, and technical
safeguards, appropriate to the nature of the data and the
purposes for which the data will be used, to protect the data
collected to comply with the requirements of this section from
unauthorized use, disclosure, access, destruction, or
modification.
(b) Disclosure Required.--
(1) Requirement.--
(A) In general.--An online marketplace shall--
(i) require any high-volume third party
seller with an aggregate total of $20,000 or
more in annual gross revenues on such online
marketplace, and that uses such online
marketplace's platform, to provide the
information described in subparagraph (B) to
the online marketplace; and
(ii) disclose the information described in
subparagraph (B) to consumers in a clear and
conspicuous manner--
(I) on the product listing page
(including via hyperlink); or
(II) in the order confirmation
message or other document or
communication made to the consumer
after the purchase is finalized and in
the consumer's account transaction
history.
(B) Information described.--The information
described in this subparagraph is the following:
(i) Subject to paragraph (2), the identity
of the high-volume third party seller,
including--
(I) the full name of the seller,
which may include the seller name or
seller's company name, or the name by
which the seller or company operates on
the online marketplace;
(II) the physical address of the
seller; and
(III) contact information for the
seller, to allow for the direct,
unhindered communication with high-
volume third party sellers by users of
the online marketplace, including--
(aa) a current working
phone number;
(bb) a current working
email address; or
(cc) other means of direct
electronic messaging (which may
be provided to such seller by
the online marketplace),
provided that the requirements
of this item shall not prevent
an online marketplace from
monitoring communications
between high-volume third party
sellers and users of the online
marketplace for fraud, abuse,
or spam.
(ii) Whether the high-volume third party
seller used a different seller to supply the
consumer product to the consumer upon purchase,
and, upon the request of an authenticated
purchaser, the information described in clause
(i) relating to any such seller that supplied
the consumer product to the purchaser, if such
seller is different than the high-volume third
party seller listed on the product listing
prior to purchase.
(2) Exception.--
(A) In general.--Subject to subparagraph (B), upon
the request of a high-volume third party seller, an
online marketplace may provide for partial disclosure
of the identity information required under paragraph
(1)(B)(i) in the following situations:
(i) If such seller certifies to the online
marketplace that the seller does not have a
business address and only has a residential
street address, or has a combined business and
residential address, the online marketplace
may--
(I) disclose only the country and,
if applicable, the State in which such
seller resides; and
(II) inform consumers that there is
no business address available for the
seller and that consumer inquiries
should be submitted to the seller by
phone, email, or other means of
electronic messaging provided to such
seller by the online marketplace.
(ii) If such seller certifies to the online
marketplace that the seller is a business that
has a physical address for product returns, the
online marketplace may disclose the seller's
physical address for product returns.
(iii) If such seller certifies to the
online marketplace that the seller does not
have a phone number other than a personal phone
number, the online marketplace shall inform
consumers that there is no phone number
available for the seller and that consumer
inquiries should be submitted to the seller's
email address or other means of electronic
messaging provided to such seller by the online
marketplace.
(B) Limitation on exception.--If an online
marketplace becomes aware that a high-volume third
party seller has made a false representation to the
online marketplace in order to justify the provision of
a partial disclosure under subparagraph (A) or that a
high-volume third party seller who has requested and
received a provision for a partial disclosure under
subparagraph (A) has not provided responsive answers
within a reasonable time frame to consumer inquiries
submitted to the seller by phone, email, or other means
of electronic messaging provided to such seller by the
online marketplace, the online marketplace shall, after
providing the seller with written or electronic notice
and an opportunity to respond not later than 10 days
after the issuance of such notice, suspend any future
sales activity of such seller unless such seller
consents to the disclosure of the identity information
required under paragraph (1)(B)(i).
(3) Reporting mechanism.--An online marketplace shall
disclose to consumers in a clear and conspicuous manner on the
product listing of any high-volume third party seller a
reporting mechanism that allows for electronic and telephonic
reporting of suspicious marketplace activity to the online
marketplace.
(4) Compliance.--If a high-volume third party seller does
not comply with the requirements to provide and disclose
information under this subsection, the online marketplace
shall, after providing the seller with written or electronic
notice and an opportunity to provide or disclose such
information not later than 10 days after the issuance of such
notice, suspend any future sales activity of such seller until
the seller complies with such requirements.
(c) Enforcement by Federal Trade Commission.--
(1) Unfair and deceptive acts or practices.--A violation of
subsection (a) or (b) by an online marketplace shall be treated
as a violation of a rule defining an unfair or deceptive act or
practice prescribed under section 18(a)(1)(B) of the Federal
Trade Commission Act (15 U.S.C. 57a(a)(1)(B)).
(2) Powers of the commission.--
(A) In general.--The Commission shall enforce
subsections (a) and (b) in the same manner, by the same
means, and with the same jurisdiction, powers, and
duties as though all applicable terms and provisions of
the Federal Trade Commission Act (15 U.S.C. 41 et seq.)
were incorporated into and made a part of this section.
(B) Privileges and immunities.--Any person that
violates subsection (a) or (b) shall be subject to the
penalties, and entitled to the privileges and
immunities, provided in the Federal Trade Commission
Act (15 U.S.C. 41 et seq.).
(3) Regulations.--The Commission may promulgate regulations
under section 553 of title 5, United States Code, with respect
to the collection, verification, or disclosure of information
under this section, provided that such regulations are limited
to what is necessary to collect, verify, and disclose such
information.
(4) Authority preserved.--Nothing in this section shall be
construed to limit the authority of the Commission under any
other provision of law.
(d) Enforcement by State Attorneys General.--
(1) In general.--If the attorney general of a State has
reason to believe that any online marketplace has violated or
is violating this section or a regulation promulgated under
this section that affects one or more residents of that State,
the attorney general of the State may bring a civil action in
any appropriate district court of the United States, to--
(A) enjoin further such violation by the defendant;
(B) enforce compliance with this section or such
regulation;
(C) obtain civil penalties in the amount provided
for under subsection (c);
(D) obtain other remedies permitted under State
law; and
(E) obtain damages, restitution, or other
compensation on behalf of residents of the State.
(2) Notice.--The attorney general of a State shall provide
prior written notice of any action under paragraph (1) to the
Commission and provide the Commission with a copy of the
complaint in the action, except in any case in which such prior
notice is not feasible, in which case the attorney general
shall serve such notice immediately upon instituting such
action.
(3) Intervention by the commission.--Upon receiving notice
under paragraph (2), the Commission shall have the right--
(A) to intervene in the action;
(B) upon so intervening, to be heard on all matters
arising therein; and
(C) to file petitions for appeal.
(4) Limitation on state action while federal action is
pending.--If the Commission has instituted a civil action for
violation of this section or a regulation promulgated under
this section, no State attorney general, or official or agency
of a State, may bring a separate action under paragraph (1)
during the pendency of that action against any defendant named
in the complaint of the Commission for any violation of this
section or a regulation promulgated under this section that is
alleged in the complaint. A State attorney general, or official
or agency of a State, may join a civil action for a violation
of this section or regulation promulgated under this section
filed by the Commission.
(5) Rule of construction.--For purposes of bringing a civil
action under paragraph (1), nothing in this section shall be
construed to prevent the chief law enforcement officer, or
official or agency of a State, from exercising the powers
conferred on such chief law enforcement officer, or official or
agency of a State, by the laws of the State to conduct
investigations, administer oaths or affirmations, or compel the
attendance of witnesses or the production of documentary and
other evidence.
(6) Actions by other state officials.--
(A) In general.--In addition to civil actions
brought by attorneys general under paragraph (1), any
other officer of a State who is authorized by the State
to do so, except for any private person on behalf of
the State attorney general, may bring a civil action
under paragraph (1), subject to the same requirements
and limitations that apply under this subsection to
civil actions brought by attorneys general.
(B) Savings provision.--Nothing in this subsection
may be construed to prohibit an authorized official of
a State from initiating or continuing any proceeding in
a court of the State for a violation of any civil or
criminal law of the State.
(e) Severability.--If any provision of this section, or the
application thereof to any person or circumstance, is held invalid, the
remainder of this section and the application of such provision to
other persons not similarly situated or to other circumstances shall
not be affected by the invalidation.
(f) Definitions.--In this section:
(1) Commission.--The term ``Commission'' means the Federal
Trade Commission.
(2) Consumer product.--The term ``consumer product'' has
the meaning given such term in section 101 of the Magnuson-Moss
Warranty--Federal Trade Commission Improvement Act (15 U.S.C.
2301) and section 700.1 of title 16, Code of Federal
Regulations.
(3) High-volume third party seller.--
(A) In general.--The term ``high-volume third party
seller'' means a participant on an online marketplace's
platform who is a third party seller and, in any
continuous 12-month period during the previous 24
months, has entered into 200 or more discrete sales or
transactions of new or unused consumer products and an
aggregate total of $5,000 or more in gross revenues.
(B) Clarification.--For purposes of calculating the
number of discrete sales or transactions or the
aggregate gross revenues under subparagraph (A), an
online marketplace shall only be required to count
sales or transactions made through the online
marketplace and for which payment was processed by the
online marketplace, either directly or through its
payment processor.
(4) Online marketplace.--The term ``online marketplace''
means any person or entity that operates a consumer-directed
electronically based or accessed platform that--
(A) includes features that allow for, facilitate,
or enable third party sellers to engage in the sale,
purchase, payment, storage, shipping, or delivery of a
consumer product in the United States;
(B) is used by one or more third party sellers for
such purposes; and
(C) has a contractual or similar relationship with
consumers governing their use of the platform to
purchase consumer products.
(5) Seller.--The term ``seller'' means a person who sells,
offers to sell, or contracts to sell a consumer product through
an online marketplace's platform.
(6) Third party seller.--
(A) In general.--The term ``third party seller''
means any seller, independent of an online marketplace,
who sells, offers to sell, or contracts to sell a
consumer product in the United States through such
online marketplace's platform.
(B) Exclusions.--The term ``third party seller''
does not include, with respect to an online
marketplace--
(i) a seller who operates the online
marketplace's platform; or
(ii) a business entity that has--
(I) made available to the general
public the entity's name, business
address, and working contact
information;
(II) an ongoing contractual
relationship with the online
marketplace to provide the online
marketplace with the manufacture,
distribution, wholesaling, or
fulfillment of shipments of consumer
products; and
(III) provided to the online
marketplace identifying information, as
described in subsection (a), that has
been verified in accordance with that
subsection.
(7) Verify.--The term ``verify'' means to confirm
information provided to an online marketplace pursuant to this
section, which may include the use of one or more methods that
enable the online marketplace to reliably determine that any
information and documents provided are valid, corresponding to
the seller or an individual acting on the seller's behalf, not
misappropriated, and not falsified.
(g) Relationship to State Laws.--No State or political subdivision
of a State, or territory of the United States, may establish or
continue in effect any law, regulation, rule, requirement, or standard
that conflicts with the requirements of this section.
(h) Effective Date.--This section shall take effect 180 days after
the date of the enactment of this Act.
Passed the House of Representatives November 17, 2022.
Attest:
Clerk.
117th CONGRESS
2d Session
H. R. 5502
_______________________________________________________________________
AN ACT
To require online marketplaces to verify certain information regarding
high-volume third party sellers of consumer products on such online
marketplaces and to disclose to consumers certain contact and other
information regarding such high-volume third party sellers.