$1.7 Trillion Spending Bill Requires Verification of Sellers Earning $5,000 Annually

Last Friday, the US Congress approved a $1.7 trillion funding bill, which includes the Integrity, Notification, and Fairness in Online Retail Marketplaces (INFORM) for Consumers Act.

The INFORM Act aims to regulate online marketplaces by requiring e-commerce companies to collect, verify, and disclose personal information from high-volume, third-party sellers who have conducted 200 or more transactions with annual revenues exceeding $5,000, according to a report from Reclaim the Net.

The information that must be disclosed includes sellers’ bank account numbers, government-issued identification, tax identification numbers, and contact information.

Online marketplaces must make sure that consumers have access to sellers’ names and contact information, as well as other unspecified data included in product listings.

However, sellers will be able to protect their phone numbers and addresses if they communicate with buyers through the marketplaces’ customer support.

Initially, the INFORM Act faced opposition from Amazon and other sites, who argued that it threatened sellers’ privacy and gave brick-and-mortar stores an advantage.

But the requirement for sellers to disclose personal information to customers was later raised to $20,000 in annual revenues, causing Amazon, eBay, and Etsy to drop their criticism and support the bill.

The INFORM Act also has significant implications for e-commerce companies as it supersedes state laws and will be enforced by the Federal Trade Commission.

Consumers will also be able to report suspicious activity to e-commerce operations either online or by phone.

LATEST VIDEO