US lawmakers reintroduce bill to tackle online counterfeits

US lawmakers have reintroduced legislation intended to fight the sale of counterfeit and stolen goods online, that wasn't able to get onto the statute during the Trump presidency.

With a new administration under Joe Biden now in office, the INFORM Consumers Act has been tabled again and if passed would make it mandatory for any online retail platform that allows third-party sellers – such as Amazon, eBay or Alibaba – to authenticate the identity of high-volume third-party sellers.

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.

If passed, sellers on e-commerce platforms would be required to disclose basic information, including their government ID, tax ID, bank account information, and contact details. Third-party marketplaces would also need to supply a hotline to allow customers to report any suspicious activity.

The bipartisan bill – introduced yesterday by Senators Durbin (D-IL), Cassidy (R-LA), Hirono (D-HI), Grassley (R-IA), Coons (D-DE) and Tillis (R-NC) – comes as the volume of illicit goods sold online has accelerated thanks to the pandemic.

Part of that is due to people relying more heavily on online retailers as a result of lockdowns caused by COVID-19, but criminals have also lost no time in preying on consumer anxieties by offering counterfeits of goods like hand sanitizer, masks and even drugs, diagnostics and vaccines for sale.

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In statement, Sen Dick Durbin said that "people deserve to know basic information about those who sell them consumer products online."

"Our bill ensures a baseline level of transparency for online marketplaces, where currently it may be difficult to know who third-party sellers are and how to contact them," he added.

"The INFORM Consumers Act will help promote responsible marketplace behaviour, discourage shadowy sales practices, and protect consumers."

According to the Organisation for Economic Co-operation and Development (OECD), commerce in fake and pirated goods was 3.3% of world trade and rising even ahead of the pandemic, representing a market worth around $500bn worldwide.

Commenting on the reintroduction of the bill, the Transnational Alliance to Combat Illicit Trade (TRACIT) and Buy Safe America Coalition campaigns said that it is time to move beyond voluntary approaches toward a more comprehensive means to assuring a safe environment for e-commerce backed up by legislation.

"Business and consumers need harmonized rules that assure the same safe and accountable shopping experience online as they enjoy in the brick-and-mortar world," they said in a joint statement.