Amazon and peers eBay and Etsy are waging a lobbying war to scuttle bills pushed by brick-and-mortar retailers who want to require their online rivals to disclose more information about third-party sellers, Axios' Margaret Harding McGill reports.
Why it matters: Online shopping became a lifeline for consumers and businesses during the pandemic, and lawmakers say that makes fighting online fraud and theft even more important.
What's happening: Bills in Congress and at the state level, known as INFORM acts, aim to force Amazon and other e-commerce sites to verify the identity of their third-party sellers and disclose some contact information about the sellers to consumers.
- Supporters of the legislation — including Home Depot, Walgreens and other major retailers that have formed the Buy Safe America Coalition — say the new measures are necessary to help deter online sales of stolen and counterfeit goods.
- But Amazon, Etsy, eBay and other online marketplaces have argued the proposals could hurt sellers' privacy and are being pushed by big box stores to give them an advantage over their online competitors.
What they're doing: Online marketplace leaders have launched their own coalitions to fend off the legislation.
- The Amazon-backed Internet Association is funding the Makers and Merchants Coalition, which argues the laws would hurt small sellers trying to supplement their income during the pandemic.
- "When you look at the unintended consequences of sellers trying to choose between their privacy and their safety and their livelihood, the result is you’re going to have fewer sellers online — and that really just benefits the Walmarts and Home Depots and the Lowes," Alexis Marvel, a spokesperson for the group, told Axios.
Meanwhile, Etsy, eBay, Poshmark and other platforms formed their own coalition to highlight the special privacy concerns of their sellers. For example, Etsy says 97% of its sellers operate out of their homes.
The online marketplaces notched a win when senators failed to hitch the legislation to a China-focused competition bill that passed the Senate this week.
- "The INFORM Act favors large brick-and-mortar retailers, at the expense of small businesses that sell online, while doing nothing to prevent fraud and abuse or hold bad actors accountable," an Amazon spokesperson said in a statement.
At least 17 states have considered similar legislation, and online marketplace groups point out that the only state that has passed a bill has been Arkansas, home of Walmart.
The other side: Retailers and other members of the Buy Safe America Coalition are trying to spotlight and counter the problem of stolen and counterfeit goods during the pandemic, Michael Hanson, spokesperson for the Buy Safe America Coalition, said.
- California law enforcement busted an alleged retail theft operation in San Francisco last year and recovered $8 million in stolen merchandise from stores like CVS and Target.
What to watch: With the China competition bill heading to the House, lawmakers have another opportunity to attach the language to the legislation.