HSB 687

Third-party sellers do not include a seller that operates the online marketplace platform or a business entity meeting specified requirements. The bill defines a “high-volume third-party seller” to mean a participant on an online marketplace platform that is a third-party seller and for a continuous 12-month period within the previous months entered into 200 or more sales or transactions of consumer products, made through the online marketplace and for which payment was processed by the online marketplace, with an aggregate total of $5,000 or more in gross revenue. The bill provides that an online marketplace shall require that a high-volume third-party seller disclose certain information to the online marketplace, including bank account information, a business or individual tax number, and email address, phone number, and other contact information. The bill requires that an online marketplace shall send a notification to a high-volume third-party seller at least once per year requesting updated information. The online marketplace shall verify that the information the seller is providing is correct. _____ provide the required information, the online marketplace shall issue a notice to the seller, and upon the expiration of days following the notice with no additional information supplied, the online marketplace shall suspend the high-volume third-party seller from additional sales until the information is provided. The bill provides that an online marketplace shall collect data solely to comply with the requirements of the bill and any applicable laws and that the data may not be used for other purposes. An online marketplace shall maintain security practices to protect data collected from a high-volume third-party seller from unauthorized use, disclosure, access, destruction, or modification. The bill provides that a high-volume third-party seller with a cumulative total of $20,000 or more in annual gross revenues on an online marketplace shall disclose specified information to the online marketplace for the benefit of consumers. High-volume third-party sellers shall disclose the full name of the seller, the physical address of the seller, and contact information. High-volume third-party sellers may use as a name an individual natural person, the name of the company, or the name by which the seller or company operates on the online marketplace. High-volume third-party sellers shall provide users of the online marketplace a current working phone number, a current working email address, or other means of direct electronic messaging to facilitate direct communication with consumers. High-volume third-party seller contact information shall be displayed in a conspicuous manner on an internet site maintained by the seller. High-volume third-party sellers using a different seller to supply the consumer products must disclose contact information for a consumer upon purchase and consumer request. The bill provides that online marketplaces shall disclose a reporting mechanism for consumers to use in sales or potential sales involving suspicious marketplace activity. _____ The bill provides that high-volume third-party sellers may request to have a partial disclosure of contact information upon request to the online marketplace. False representations relating to partial disclosure or failure of a seller who obtained partial disclosure to communicate with consumers shall be contacted by the online marketplace. The online marketplace shall provide notice and shall suspend any future sales activity of such seller unless such seller discloses additional contact information. The bill provides that the attorney general has authority to enforce provisions of the bill and may bring a civil action against an online marketplace operating in violation of the provisions of the bill. A violation of the bill’s provisions is punishable by a civil penalty in an amount up to $100,000. The attorney general shall adopt rules as necessary to implement the bill’s provisions. The bill takes effect January 1, 2023.