Stop Online Booking Scams Act of 2016

To protect consumers from deceptive practices with respect to online booking of hotel reservations, and for other purposes. 1. Short title This Act may be cited as the Stop Online Booking Scams Act of 2016 2. Findings; sense of Congress (a) Findings Congress finds the following: (1) The Internet has become an important channel of commerce in the United States, accounting for billions of dollars in retail sales every year. (2) Hotel reservation transactions can be easily made online and online commerce has created a marketplace where consumers can shop for hotels, flights, car rentals, and other travel-related services and products across thousands of brands on a single platform. (3) Consumers should have the utmost clarity as to the company with which such consumers are transacting business online. (4) Actions by third-party sellers that mis­ap­pro­pri­ate brand identity, trademark, or other marketing content are harmful to consumers. (5) Platforms offered by online travel agencies provide consumers with a valuable tool for comparative shopping for hotels and should not be mistaken for the unlawful third-party actors that commit such misappropriation. (6) The misleading and deceptive sales tactics companies use against customers booking hotel rooms online have resulted in the loss of sensitive financial and personal information, financial harm, and headache for consumers. (b) Sense of Congress It is the sense of Congress that— (1) consumers benefit from the ability to shop for travel-related services and products on the innovative platforms offered by online travel agencies; (2) sellers on the Internet should provide consumers with clear, accurate information and such sellers should have an opportunity to compete fairly with one another; and (3) the Federal Trade Commission should revise the Internet Web site of the Commission to make it easier for consumers and businesses to report complaints of deceptive practices with respect to online booking of hotel reservations. 3. Definitions In this Act: (1) Affiliation contract The term affiliation contract (2) Commission The term Commission (3) Exhibition organizer or meeting planner The term exhibition organizer or meeting planner (4) Official housing bureau The term official housing bureau (5) Party directly affiliated The term party directly affiliated (6) Third party online hotel reservation seller The term third party online hotel reservation seller (A) sells any good or service with respect to a hotel in a transaction effected on the Internet; and (B) is not— (i) a party directly affiliated with the hotel; or (ii) an exhibition organizer or meeting planner or the official housing bureau for a meeting, conference, event, or exhibition held at the hotel. 4. Requirements for third party online hotel reservation sellers (a) In general It shall be unlawful for a third party online hotel reservation seller to charge or attempt to charge any consumer’s credit card, debit card, bank account, or other financial account for any good or service sold in a transaction effected on the Internet with respect to a hotel unless the third party online hotel reservation seller— (1) clearly and conspicuously discloses to the consumer all material terms of the transaction, including— (A) before the conclusion of the transaction— (i) a description of the good or service being offered; and (ii) the cost of such good or service; and (B) in a manner that is continuously visible to the consumer throughout the transaction process, the fact that the person is a third party online hotel reservation seller and is not— (i) affiliated with the person who owns the hotel or provides the hotel services or accommodations; or (ii) an exhibition organizer or meeting planner or the official housing bureau for a meeting, conference, event, or exhibition held at the hotel; or (2) includes prominent and continuous disclosure of the brand identity of the third party online hotel reservation seller throughout the transaction process, both online and over the phone. (b) Enforcement by Commission (1) Unfair or deceptive acts or practices A violation of subsection (a) by a person subject to such subsection 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 Commission (A) In general The Commission shall enforce this section 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. (B) Privileges and immunities Any person who violates this section 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. (C) Rulemaking (i) In general The Commission may promulgate such rules as the Commission considers appropriate to enforce this section. (ii) Procedures The Commission shall carry out any rulemaking under clause (i) in accordance with section 553 of title 5, United States Code. (c) Enforcement by States (1) In general In any case in which the attorney general of a State has reason to believe that an interest of the residents of the State has been or is threatened or adversely affected by the engagement of any person subject to subsection (a) in a practice that violates such subsection, the attorney general of the State may, as parens patriae, bring a civil action on behalf of the residents of the State in an appropriate district court of the United States to obtain appropriate relief. (2) Rights of Federal Trade Commission (A) Notice to Federal Trade Commission (i) In general Except as provided in clause (iii), the attorney general of a State shall notify the Commission in writing that the attorney general intends to bring a civil action under paragraph (1) before initiating the civil action against a person subject to subsection (a). (ii) Contents The notification required by clause (i) with respect to a civil action shall include a copy of the complaint to be filed to initiate the civil action. (iii) Exception If it is not feasible for the attorney general of a State to provide the notification required by clause (i) before initiating a civil action under paragraph (1), the attorney general shall notify the Commission immediately upon instituting the civil action. (B) Intervention by Federal Trade Commission The Commission may— (i) intervene in any civil action brought by the attorney general of a State under paragraph (1) against a person described in subsection (d)(1); and (ii) upon intervening— (I) be heard on all matters arising in the civil action; and (II) file petitions for appeal of a decision in the civil action. (3) Investigatory powers Nothing in this subsection may be construed to prevent the attorney general of a State from exercising the powers conferred on the attorney general by the laws of the State to conduct investigations, to administer oaths or affirmations, or to compel the attendance of witnesses or the production of documentary or other evidence. (4) State coordination with Federal Trade Commission If the Commission institutes a civil action or an administrative action with respect to a violation of subsection (a), the attorney general of a State shall coordinate with the Commission before bringing a civil action under paragraph (1) against any defendant named in the complaint of the Commission for the violation with respect to which the Commission instituted such action. (5) Venue; service of process (A) Venue Any action brought under paragraph (1) may be brought in— (i) the district court of the United States that meets applicable requirements relating to venue under section 1391 of title 28, United States Code; or (ii) another court of competent jurisdiction. (B) Service of process In an action brought under paragraph (1), process may be served in any district in which the defendant— (i) is an inhabitant; or (ii) may be found. (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 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.

Summary: Stop Online Booking Scams Act of 2016 This bill prohibits third party online hotel reservation sellers from charging a consumer's credit card or financial accounts in an Internet transaction for a hotel unless they disclose: (1) a description of the offered good or service, the cost, and other material terms before the conclusion of the transaction; (2) that the third party seller is not affiliated with the person who owns or provides the hotel services or accommodations and is not an exhibition organizer, a meeting planner, or the official housing bureau for an event at the hotel; and (3) the brand identity of the third party both online and over the phone. The bill provides authority to the Federal Trade Commission (FTC) and states to enforce against violations. The bill also expresses the sense of Congress that the FTC should revise its website to make it easier for consumers and businesses to report complaints of deceptive practices with respect to online booking of hotel reservations.