State Legislatures Introduce Bills Similar to Inform Act on Online Marketplaces
To help prevent someone from selling stolen goods on a marketplace, California, Florida, Massachusetts, New Hampshire, Ohio, and Washington state legislators have proposed bills that would require marketplaces to obtain and share the names and contact information of high-volume marketplace sellers.
The California bill would require e-commerce platforms to obtain (and retain for five years) identifying information from third-party sellers who, in any continuous 12-month period during the previous 24 months, made 200 or more discrete sales or transactions of new or unused consumer products through the online marketplace or its payment processor, and those sales resulted in the accumulation of an aggregate total of $5,000 or more in gross revenues in the state, according to a blog post at the Avalara website.
The information would include:
- A bank account number (or the name of the payee in the event the seller has no bank account)
- The seller’s name (if an individual) or a copy of a valid government-issued identification (or a copy of a valid government record or tax document that includes the business name and physical address of the seller) for an individual acting on behalf of the seller
- A business tax identification number or taxpayer identification number
- A valid email address and telephone number for the seller.
The federal bill, the Inform Consumers Act, would also tell online marketplaces to verify high-volume third-party sellers by acquiring the seller’s government ID, tax ID, bank account information, and contact information. High-volume third-party sellers are defined as vendors who have made 200 or more discrete sales in a 12-month period amounting to $5,000 or more. That language is in the House's China package (see 2202040011), and Sen. Bill Cassidy, R-La., the bill's champion in the Senate, believes it will make it into the final version (see 2202020055).
In California, sellers with at least $20,000 in gross annual revenues in California from a platform would also have to provide the seller's full name or company name, physical address, and direct contact information, though sellers operating out of their homes would be able to request an exception from the physical address requirement. Those sellers also would have to say if they contracted with someone else to supply the product to the consumer.
Both the state and federal bills are designed to make it more difficult for shoplifters and counterfeiters to avoid scrutiny from law enforcement by selling on e-commerce platforms.