Title: 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.
Policy area: Commerce

Summary:
This bill requires online marketplaces (e.g., Amazon) to collect and verify certain contact and financial information from third-party sellers whose transactions and related revenues exceed specified thresholds.
Subject to certain exceptions, online marketplaces must clearly and conspicuously disclose the contact information of certain high-volume third-party sellers to consumers and must also provide consumers with methods to report suspicious activity on the marketplace.
The bill provides the Federal Trade Commission and state attorneys general with the authority to enforce these requirements.

[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5502 Introduced in House (IH)]

<DOC>






117th CONGRESS
  1st Session
                                H. R. 5502

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.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 5, 2021

Ms. Schakowsky (for herself and Mr. Bilirakis) introduced the following 
    bill; which was referred to the Committee on Energy and Commerce

_______________________________________________________________________

                                 A BILL


 
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. 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 on 
                                        demand 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;
                                    (II) there have been no changes to 
                                such seller's information; or
                                    (III) such seller has provided any 
                                changes to such information to the 
                                online marketplace.
                    (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) in the order confirmation 
                                message or other document or 
                                communication made to a consumer after 
                                a purchase is finalized; and
                                    (II) 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).
                            (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 ftc.--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, 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 who, 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.
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