WEST virginia legislature

2023 regular session

Introduced

House Bill 2949

By Delegate Foster

[Introduced January 24, 2023; Referred to the Committee on the Judiciary]

A BILL to amend the Code of West Virginia, 1931, as amended, by adding thereto a new article, designated §46A-9-1, relating to requiring high-volume third-party sellers to provide information to online marketplaces; requiring ongoing verification of information; requiring high-volume third-party sellers to disclose certain information to consumers; providing for Attorney General enforcement of act; authorizing rulemaking by Attorney General; establishing preemption of municipal requirements; defining terms; and providing effective date.

Be it enacted by the Legislature of West Virginia:

Article 9. Disclosure of Information by Online Marketplaces to Inform Consumers.

§46A-9-1. High volume third party sellers to provide and disclose information to online marketplaces and to inform consumers; enforcement; rulemaking; preemption; defining terms; and effective date.

(a) Verification Required. —

(1) Online marketplaces shall require that any high-volume third-party seller on the online marketplace provide the online marketplace with the following information within 24 hours of becoming a high-volume third-party seller:

(A) Bank account information, the accuracy of which has been confirmed directly by the online marketplace or by a payment processor or other third-party contracted by the online marketplace, or, if the high-volume third-party seller does not have a bank account, the name of the payee for payments issued by the online marketplace to the high-volume third-party seller. The bank account or payee information may be provided by the seller either:

(i) To the online marketplace; or

(ii) To a payment processor or other third-party contracted by the online marketplace to maintain the information, provided that the online marketplace may obtain the information on demand from the payment processor or other third-party.

(B) Contact information, including:

(i) If the high-volume third-party seller is an individual, a copy of a government-issued photo identification for the individual that includes the individual’s name and physical address; or

(ii) If the high-volume third-party seller is not an individual, either:

(I) A copy of a government-issued photo identification for an individual acting on behalf of the high-volume third-party seller that includes the individual’s name and physical address; or

(II) A copy of a government-issued record or tax document that includes the business name and physical address of the high-volume third-party seller; and

(iii) A working email address and working phone number for the high-volume third-party seller.

(C) A business tax identification number or, if the high-volume third-party seller does not have a business tax identification number, a taxpayer identification number.

(D) Whether the high-volume third-party seller is exclusively advertising or offering the consumer product or products on the online marketplace, or if the high-volume third-party seller is currently advertising or offering for sale the same consumer product or products on any other internet websites other than the online marketplace.

(2) Ongoing Verification Required. —

(A) The online marketplace shall verify the information provided in paragraph (1) within three days, and shall verify within three days any changes to the information that is provided to the marketplace by a high-volume third-party seller. If a high-volume third-party seller provides a copy of a valid government-issued tax document, information contained within the tax document shall be presumed to be verified as of the date of issuance of the record or document.

(B) The online marketplace shall, on at least an annual basis, notify each high-volume third-party seller on the online marketplace that the seller must inform the online marketplace of any changes to the information provided by the seller pursuant to paragraph (1) within three days of receiving the notification and shall instruct each high-volume third-party seller, as part of the notification, to electronically certify either that the seller’s information is unchanged or that the seller is providing changes to the information. If the online marketplace becomes aware that a high-volume third-party seller has neither certified that the seller’s information is unchanged nor provided the changed information within three days of receiving the notification, the online marketplace shall suspend the high-volume third-party seller’s participation on the marketplace until the seller has either certified that the seller’s information is unchanged or has provided the changed information and the information has been verified.

(b) Disclosure Required. —

(1) Any online marketplace shall require a high-volume third-party seller in the online marketplace to provide, and shall disclose to consumers in a conspicuous manner either on the product listing or, for information other than the seller’s full name, through a conspicuously placed link on the product listing, the following information:

(A) Subject to paragraph (2) of this section , the identity of the high-volume third-party seller which shall include:

(i) The full name of the seller;

(ii) The full physical address of the seller;

(iii) Whether the seller also engages in the manufacturing, importing, or reselling of consumer products; and

(iv) Contact information for the seller, including a working phone number and working email address. The working email address may be provided to the high-volume third-party seller by the online marketplace.

(B) Any other information determined to be necessary to address circumvention or evasion of the requirements of this paragraph, provided that the additional information is limited to what is necessary to address the circumvention or evasion.

(2) Exceptions. —

(A) Subject to subparagraph (B) of this section, upon the request of a high-volume third-party seller, an online marketplace may provide for partial disclosure of the identity information required under paragraph (1)(A) of this section in the following situations:

(i) If the high-volume third-party seller demonstrates to the online marketplace that the seller does not have a business address and only has a residential street address, the online marketplace may direct the high-volume third-party seller to disclose only the country and, if applicable, the state in which the high-volume third-party seller resides on the product listing, and may inform consumers that there is no business address available for the seller and that consumer inquiries should be submitted to the seller by phone or email.

(ii) If the high-volume third-party seller demonstrates to the online marketplace that the seller is a business that has a physical address for product returns, the online marketplace may direct the high-volume third-party seller to disclose the seller’s physical address for product returns.

(iii) If a high-volume third-party seller demonstrates to the online marketplace that the seller does not have a phone number other than a personal phone number, the online marketplace shall inform consumers that there is no phone number available for the seller and that consumer inquiries should be submitted to the seller’s email address.

(B) Limitations to Exceptions—If an online marketplace becomes aware that a high-volume third-party seller has made a false representation to the online marketplace in order to justify the provision of a partial disclosure under subparagraph (A) of this section or that a high-volume third-party seller who has requested and received a provision for a partial disclosure under subparagraph (A) of this section has not provided responsive answers within a reasonable timeframe to consumer inquiries submitted to the seller by phone or email address, the online marketplace shall withdraw its provision for partial disclosure and require the full disclosure of the high-volume third-party seller’s identity information required under paragraph (1)(A) of this section upon three business days’ notice to the high-volume third-party seller.

(3) Reporting Mechanism. — An online marketplace shall disclose to consumers, in a conspicuous manner on the product listing of any high-volume third-party seller, a reporting mechanism that allows for electronic and telephonic reporting of suspicious marketplace activity to the online marketplace and a message encouraging individuals seeking goods for purchase to report suspicious activity to the online marketplace.

(c) Fulfillment Or Shipment By Different Party Than Seller. — In addition to the requirements of subsection (b), an online marketplace that warehouses, distributes, or otherwise fulfills a consumer product order shall disclose to the consumer the identification of any high-volume third-party seller supplying the consumer product if different than the seller listed on the product listing page.

(d) Enforcement. —

(1) Unfair and Deceptive Acts or Practices. — A violation of subsection (a), (b), or (c) of this section shall be treated as a violation of the Consumer Credit and Protection Act.

(2) Powers of the Attorney General. — The Attorney General shall enforce this Act.

(3) Rules. — The Attorney General may propose rules for legislative approval in accordance with §29A-3-1 et seq. of this code with respect to collecting and verifying information under this section, provided that the rules are limited to what is necessary to collect and verify the information.

(e) Preemption. — No political subdivision may establish, mandate, or otherwise require online marketplaces to verify information from high-volume third-party sellers on a one-time or ongoing basis or disclose information to consumers.  

(f) Definitions. — In this Act:

Consumer Product. — The term "consumer product" means any tangible personal property which is distributed in commerce and which is normally used for personal, family, or household purposes (including any such property intended to be attached to or installed in any real property without regard to whether it is so attached or installed).

High-Volume Third-Party Seller. — The term "high-volume third-party seller" means a participant in an online marketplace who is a third-party seller and who, in any continuous 12-month period during the previous 24 months, has entered into 200 or more discrete sales or transactions of new or unused consumer products resulting in the accumulation of an aggregate total of $5,000 or more in gross revenues.

Online Marketplace. — The term "online marketplace" means any electronically based or accessed platform that:

(A) Includes features that allow for, facilitate, or enable third-party sellers to engage in the sale, purchase, payment, storage, shipping, or delivery of a consumer product in the United States; and

(B) Hosts one or more third-party sellers.

Seller. — The term "seller" means a person who sells, offers to sell, or contracts to sell a consumer product through an online marketplace.

Third-Party Seller. —

(A) The term "third-party seller" means any seller, independent of an operator, facilitator, or owner of an online marketplace, who sells, offers to sell, or contracts to sell a consumer product in the United States through an online marketplace.

(B) Exclusion. — The term "third-party seller" does not include a seller who:

(i) Is a business entity that has made available to the general public the entity’s name, business address, and working contact information;

(ii) Has an ongoing contractual relationship with the owner of the online marketplace to provide for the manufacture, distribution, wholesaling, or fulfillment of shipments of consumer products; and

(iii) Has provided to the online marketplace identifying information, as described in subsection (a), that has been verified pursuant to that subsection.

Verify. — The term "verify" means to confirm information provided to an online marketplace pursuant to this section by the use of:

(A) A third-party or proprietary identity verification system that has the capability to confirm a seller’s name, email address, physical address, and phone number; or

(B) A combination of two-factor authentication, public records search, and the presentation of a government-issued identification.

NOTE: The purpose of this bill is to require high volume third party sellers to provide information to online marketplaces; require ongoing verification of information; require high-volume third-party sellers to disclose certain information to consumers; provide for Attorney General enforcement of act; authorize rulemaking by Attorney General; establish preemption of municipal requirements; define terms; and provide effective date.

Strike-throughs indicate language that would be stricken from a heading or the present law, and underscoring indicates new language that would be added.