- The Inform Act, in effect from Tuesday, aims to curb organized retail theft and sale of counterfeit products online.
- The law mandates online platforms to verify and disclose information about high-volume third-party sellers.
- Violators of the Inform Act will face substantial civil penalties, a move that reinforces transparency in online transactions.
As of Tuesday, the Inform Act, a freshly enacted law targeting the significant issue of organized retail theft and the online vending of counterfeit and potentially hazardous products, is in effect. The legislation was established in response to retailers attributing dwindling profits to theft.
This bipartisan legislation, officially known as Integrity, Notification and Fairness in Online Retail Marketplaces, took more than a year of dedicated effort by Representatives Jan Schakowsky (D-Ill.) and Gus Bilirakis (R-Fla.) to finally be passed in December as part of an expansive spending bill.
The Inform Act aims to unmask sellers on online platforms such as Amazon and eBay who typically operate under anonymity. The law mandates these online marketplaces to verify and divulge information regarding high-volume third-party sellers on their platforms. As noted by the Federal Trade Commission (FTC), the law's objective is to boost transparency in online dealings and deter criminals from capitalizing on these platforms to sell stolen, counterfeit, or harmful products.
Six months have passed since the bill was approved, during which online marketplaces were expected to comply. Violation of the new law now attracts substantial civil penalties. The law comes as a relief to trade associations and retailers who had been battling a significant surge in retail theft and blamed loose regulations concerning third-party sellers and verification procedures on online platforms for the problem.
The Inform Act is a welcome stride towards fighting the prevalent issue of organized retail theft, which has witnessed a spike parallel to the explosion of online shopping. The rise of e-commerce, largely due to the Covid pandemic, has created an environment conducive to such crimes. Experts have underscored the need for lawmakers to address this issue, stating that it has been challenging to apprehend those who peddle stolen goods online due to the cover of anonymity they enjoy.
WOM Money Picks
Be a part of the winning team | 81% Success Rate.