By SEMA Washington, D.C., Staff
The SEMA-supported “INFORM Consumers Act,” H.R. 5502, passed the U.S. House of Representatives as part of the “America Creating Opportunities for Manufacturing, Pre-Eminence in Technology, and Economic Strength Act of 2022” (America COMPETES Act), H.R. 4521. The INFORM Consumers Act, which appears as Section 20213 of the larger bill, is designed to protect Americans from criminals who sell counterfeit and stolen goods through online marketplaces. Below are highlights of the INFORM Consumers Act:
- Requires online marketplaces to verify certain information about high-volume third-party sellers of consumer products (sellers who make 200 or more discrete sales or transactions totaling at least $5,000 during any continuous 12-month period in the last 24 months), including the seller’s bank account number, business tax identification number or a taxpayer identification number and contact information.
- High-volume third-party sellers with $20,000 in annual gross revenue through an online marketplace would have to disclose to consumers the full name of the seller or company, business address and contact info (current working email address, phone number or other direct electronic messaging for the seller) after each sale.
- Empowers online marketplaces to suspend high-volume third-party sellers of consumer products who do not provide the required information within 10 days of the request from the online marketplace.
SEMA is advocating for Congress to pass the INFORM Consumers Act in coordination with our partners that compromise the Buy Safe America Coalition, a diverse group of retailers, consumer groups, manufacturers, intellectual property advocates and law enforcement officials who support efforts at all levels of government to protect consumers and communities from the sale of counterfeit and stolen goods.
“We are alarmed by the danger posed to unsuspecting consumers when they purchase what they believe to be legitimate auto parts and equipment,” said Daniel Ingber, SEMA’s vice president of government and legal affairs. “The reality is that major sources of counterfeit products are internet consumer purchases that arrive in the United States via postal and overnight carriers. We are confident that by passing commonsense legislation like the INFORM Consumers Act, we can stop these bad actors from selling dangerous counterfeit automotive parts and equipment to unsuspecting consumers.”
There has been a steep rise in the sale of counterfeit automotive parts on online marketplaces, posing a threat to the safety of U.S. consumers. The coronavirus pandemic has only exacerbated the issue of counterfeit product sales, as traffic toward e-commerce has grown and current regulatory standards fail to hold third-party marketplaces accountable.
A recent study published by the Buy Safe America Coalition found that illegitimate imports entering the U.S. cost domestic retailers nearly $54.1 billion in sales annually, and more than 39,000 jobs in wholesaling and 280,000 retail jobs—paying more than $13.6 billion in wages and benefits to workers—were lost because of counterfeit production.
The U.S. House-passed America COMPETES Act is the counterpart to the U.S. Senate-passed “United States Innovation and Competition Act of 2021” (USICA), S. 1260, which did not include the INFORM Consumers Act. The House and Senate are expected to conference the two bills and reconcile their differences. SEMA and its coalition partners will advocate of inclusion of the INFORM Consumers Act in the final consensus bill produced by the two houses.
For additional information, contact Eric Snyder at erics@sema.org.