Legislation improves transparency to expose suspicious third-party sellers
State Rep. Ben Frederick is leading an effort in the Michigan House to protect residents from dishonest third-party sellers who prey on consumers through online marketplaces.
Frederick, of Owosso, today introduced bipartisan legislation to create the INFORM Act to protect Michigan families by requiring online marketplaces to post information about high-volume third-party sellers.
“Michigan families deserve to have confidence that they’re going to get what they pay for when they shop online,” Frederick said. “Sadly, dishonest third-party sellers are using popular online marketplaces to remain anonymous while selling hazardous or counterfeit products to unsuspecting consumers. These sellers should be held to the same standards of customer service and transparency as our local downtown businesses.”
Sponsored by Frederick and Reps. Mark Tisdel (R-Rochester Hills) and Samantha Steckloff (D-Farmington Hills), the Integrity, Notification, and Fairness in Online Retail Marketplaces Act will ensure that marketplaces verify who their high-volume third-party sellers are and post basic information on the seller’s store page so consumers can know who they are purchasing products from.
Within three days of becoming a high-volume third-party seller, House Bills 5485-87 require the seller to provide an online marketplace with basic information, including a government-issued photo identification of the individual acting on behalf of the business, or a government-issued document or tax record. If the seller does not provide the required information, the online marketplace would be required to suspend the seller until it has complied.
Additionally, online marketplaces would be required to post basic information about high-volume third-party sellers, including the seller’s full name, address and contact information that includes a working phone number and email address.
“Providing this basic information will help people distinguish between genuine vendors selling legitimate products and those who might be selling fake or dangerous products online,” Frederick said. “It also provides overdue accountability for those bad actors who take advantage of online shoppers.”
The plan will be referred to a House committee today for later consideration.