U.S. legislation to crackdown on fake e-commerce products

United States
Published:  10 March, 2020

The “Stopping Harmful Offers on Platforms by Screening Against Fakes in E-Commerce (Shop Safe) Act” has been introduced to the U.S. Congress to crack down on fake products sold on e-commerce platforms.

In a Judiciary release published on March 2, Jerrold Nadler, Chairman of the House Judiciary Committee and serving as the U.S. Representative for New York's 10th congressional district, said that “consumers should be able to trust that what they see and purchase online is what they will get, but counterfeiters continue to join platforms with ease and masquerade as reliable sellers in order to infect American households with dangerous and unsafe counterfeit products. The Shop Safe Act proposes a set of common-sense measures to tackle the gaps in these platforms’ systems and stop counterfeit sales.”

The proposed Act would include the establishment of a trademark liability for online marketplace platforms when a third-party sells a counterfeit product that poses a risk to consumer health or safety and that platform does not follow certain best practices; encouraging online platforms to establish best practices such as vetting sellers to ensure their legitimacy, removing counterfeit listings, and removing sellers who repeatedly sell counterfeits; and a call for online marketplaces to take steps necessary to prevent the continued sale of counterfeits by the third-party seller or face contributory liability for their actions.

The Footwear Distributors & Retailers of America (FDRA) has praised the introduction of the legislation in Congress. “Counterfeit footwear threatens jobs in our industry and puts U.S. consumers at risk, and bad actors are using popular e-commerce sites to target unsuspecting consumers”, said Matt Priest, President and CEO, FDRA. “With today’s sophisticated counterfeiting operations, it can be nearly impossible for consumers to determine a legitimate good from a counterfeit product. The SHOP SAFE Act will address this issue by requiring e-commerce platforms to take reasonable steps to prevent counterfeits from being sold on their sites.”