Bill Text: NH SB355 | 2022 | Regular Session | Amended
Bill Title: Requiring online marketplaces to disclose certain information to consumers.
Spectrum: Bipartisan Bill
Status: (Engrossed - Dead) 2022-05-17 - Conferee Change: Rep. Bershtein Replaces Rep Spilsbury 05/17/2022 [SB355 Detail]
Download: New_Hampshire-2022-SB355-Amended.html
SB 355-FN - AS AMENDED BY THE SENATE
02/16/2022 0654s
2022 SESSION
22-2948
05/04
SENATE BILL 355-FN
AN ACT requiring online marketplaces to disclose certain information to consumers.
SPONSORS: Sen. Birdsell, Dist 19; Sen. Watters, Dist 4; Sen. Gannon, Dist 23; Rep. Potucek, Rock. 6; Rep. Bartlett, Merr. 19; Sen. Cavanaugh, Dist 16
COMMITTEE: Commerce
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ANALYSIS
This bill requires third-party sellers to provide certain information to online marketplaces and to consumers. The bill makes the failure to do so a violation of the consumer protection act.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
02/16/2022 0654s 22-2948
05/04
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Twenty Two
AN ACT requiring online marketplaces to disclose certain information to consumers.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Chapter; Regulation of Online Marketplaces. Amend RSA by inserting after chapter 358-S the following new chapter:
CHAPTER 358-T
REGULATION OF ONLINE MARKETPLACES
358-T:1 Definition. In this chapter:
I. "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.
II. "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 and an aggregate total of $5,000 or more in gross revenues. For purposes of calculating the number of discrete sales or transactions or the aggregate gross revenues, an online marketplace shall only be required to count sales or transactions made through the online marketplace and for which payment was processed by the online marketplace, either directly or through its payment processor.
III. "Online marketplace" means any person or entity that operates a consumer-directed 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;
(b) Is used by one or more third-party sellers for such purposes; and
(c) Has a contractual or similar relationship with consumers governing their use of the platform to purchase consumer products.
IV. "Seller" means a person who sells, offers to sell, or contracts to sell a consumer product through an online marketplace’s platform.
V. "Third-party seller" means any seller, independent of an online marketplace, who sells, offers to sell, or contracts to sell a consumer product in the United States through an online marketplace. The term "third-party seller" shall not include, with respect to an online marketplace:
(a) A seller who operates the online marketplace’s platform; or
(b) A business entity that has:
(1) Made available to the general public the entity's name, business address, and working contact information;
(2) An ongoing contractual relationship with the online marketplace to provide the online marketplace with the manufacture, distribution, wholesaling, or fulfillment of shipments of consumer products; and
(3) Provided to the online marketplace identifying information, as described in RSA 358-T:2, that has been verified in accordance with that section.
VI. "Verify" means to confirm information provided to an online marketplace pursuant to this chapter, which may include the use of one or more methods that enable the online marketplace to reliably determine that any information and documents provided are valid, correspond to the seller or an individual acting on the seller’s behalf, not misappropriated, and not falsified.
358-T:2 Collection and Verification of Information by Online Marketplaces.
I. In general, online marketplaces shall require that any high-volume third-party seller on the online marketplace’s platform provide the online marketplace with the following information no later than 10 days after qualifying as a high-volume third-party seller on the platform:
(a) A bank account number, 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 required may be provided by the seller in the following ways:
(1) To the online marketplace; or
(2) To a payment processor or other third-party contracted by the online marketplace to maintain such information; provided that the online marketplace ensures that it can obtain such information on demand from such payment processor or other third-party.
(b) Contact information for high-volume third-party sellers as follows:
(1) If the high-volume third-party seller is an individual, the individual's name; or
(2) If the high-volume third-party seller is not an individual, one of the following forms of contact information:
(A) A copy of a valid government-issued identification for an individual acting on behalf of such seller that includes the individual's name; or
(B) A copy of a valid government-issued record or tax document that includes the business name and physical address of such 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) A current working email address and phone number for the high-volume third-party seller.
II. An online marketplace shall:
(a) Periodically, but not less than annually, notify any high-volume third-party seller on such online marketplace’s platform of the requirement to keep any information collected under paragraph I current; and
(b) Require any high-volume third-party seller on such online marketplace’s platform to, not later than 10 days after receiving the notice under subparagraph (a), electronically certify that:
(1) The high-volume third-party seller has provided any changes to such information to the online marketplace, if such changes have occurred;
(2) There have been no changes to the high-volume third-party seller’s information; or
(3) The high-volume third-party seller has provided any changes to such information to the online marketplace.
III. In the event that a high-volume third-party seller does not provide the information or certification required, the online marketplace shall, after providing the seller with written or electronic notice and an opportunity to provide such information or certification not later than 10 days after the issuance of such notice, suspend any future sales activity of such seller until such seller provides such information or certification.
IV. In general, online marketplaces shall:
(a) Verify the information collected under paragraph I not later than 10 days after such collection; and
(b) Verify any changes to such information not later than 10 days after being notified of such change by a high-volume third-party seller under paragraph II.
V. In the case of a high-volume third-party seller that provides a copy of a valid government-issued tax document, any information contained in such document shall be presumed to be verified as of the date of issuance of such record or document.
VI. Data collected solely to comply with the requirements of this chapter may not be used for any other purpose unless required by law.
VII. An online marketplace shall implement and maintain reasonable security procedures and practices, including administrative, physical, and technical safeguards, appropriate to the nature of the data and the purposes for which the data will be used, to protect the data collected to comply with the requirements of this chapter from unauthorized use, disclosure, access, destruction, or modification.
358-T:3 Disclosure of Information by Online Marketplaces to Inform Consumers.
I. An online marketplace shall:
(a) Require any high-volume third-party seller with an aggregate total of $20,000 or more in annual gross revenues on such online marketplace, and that uses such online marketplace’s platform, to provide the information described in paragraph II to the online marketplace; and
(b) Disclose the information described in paragraph II to consumers in a conspicuous manner:
(1) In the order confirmation message or other document or communication made to a consumer after a purchase is finalized; and
(2) In the consumer’s account transaction history.
II. The information described in this paragraph is the following:
(a) Subject to paragraph III, the identity of the high-volume third-party seller, including:
(1) The full name of the seller, which may include the seller name or seller’s company name, or the name by which the seller or company operates on the online marketplace;
(2) The physical address of the seller; and
(3) Contact information for the seller, to allow for the direct, unhindered communication with high-volume third-party sellers by users of the online marketplace, including:
(A) A current working phone number;
(B) A current working email address; or
(C) Other means of direct electronic messaging, which may be provided to the high-volume third-party seller by the online marketplace.
(b) Whether the high-volume third party seller used a different seller to supply the consumer product to the consumer upon purchase, and, upon the request of an authenticated purchaser, the information described in subparagraph (a) relating to any such seller that supplied the consumer product to the purchaser, if such seller is different than the high-volume third party seller listed on the product listing prior to purchase.
III.(a) Subject to subparagraph (b), upon the request of a high-volume third-party seller, an online marketplace may provide for partial disclosure of the identity information required under subparagraph II(a) in the following situations:
(1) If the high-volume third-party seller certifies to the online marketplace that the seller does not have a business address and only has a residential street address, or has a combined business and residential address, the online marketplace may:
(A) Disclose only the country and, if applicable, the state in which the high-volume third-party seller resides; and
(B) Inform consumers that there is no business address available for the seller and that consumer inquiries should be submitted to the seller by phone, email, or other means of electronic messaging provided to such seller by the online marketplace.
(2) If the high-volume third-party seller certifies to the online marketplace that the seller is a business that has a physical address for product returns, the online marketplace may disclose the seller's physical address for product returns.
(3) If a high-volume third-party seller certifies 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 or other means of electronic messaging provided to such seller by the online marketplace.
(b) 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) or that a high-volume third-party seller who has requested and received a provision for a partial disclosure under subparagraph (a) has not provided responsive answers within a reasonable timeframe to consumer inquiries submitted to the seller by phone, email, or other means of electronic messaging provided to such seller by the online marketplace, the online marketplace shall, after providing the seller with written or electronic notice and an opportunity to respond not later than 10 days after the issuance of such notice, suspend any future sales activity of such seller unless such seller consents to the disclosure of the identity information required under subparagraph II(a).
III. An online marketplace shall disclose to consumers in a clear and 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.
IV. If a high-volume third-party seller does not comply with the requirements to provide and disclose information under this subsection, the online marketplace shall, after providing the seller with written or electronic notice and an opportunity to provide or disclose such information not later than 10 days after the issuance of such notice, suspend any future sales activity of such seller until the seller complies with such requirements.
358-T:4 Enforcement. Any violation of the provisions of this chapter is an unfair or deceptive act or practice within the meaning of RSA 358-A:2. Any right, remedy, or power given to the attorney general in RSA 358-A may be used to enforce the provisions of this chapter.
358-T:5 Rulemaking. The attorney general may adopt rules under RSA 541-A relative to the collection and verification of information under this chapter, provided that such regulations are limited to what is necessary to collect and verify such information.
358-T:6 Preemption. No political subdivision shall 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.
2 Contingency. If the attorney general certifies to the director of the office of legislative services that H.R. 5502 (117th Congress (2021-2022)) or similar federal legislation requiring online marketplaces to verify and disclose certain information has become law prior to January 1, 2023, section 1 of this act shall not take effect. If H.R. 5502 or similar federal legislation requiring online marketplaces to verify and disclose certain information does not become law, section 1 of this act shall take effect January 1, 2023.
I. Section 1 of this act shall take effect as provided in section 2 of this act.
II. The remainder of this act shall take effect upon its passage.
22-2948
Redraft 12/13/21
SB 355-FN- FISCAL NOTE
AS INTRODUCED
AN ACT requiring online marketplaces to disclose certain information to consumers.
FISCAL IMPACT: [ X ] State [ ] County [ ] Local [ ] None
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STATE: | FY 2022 | FY 2023 | FY 2024 | FY 2025 |
Appropriation | $0 | $0 | $0 | $0 |
Revenue | $0 | $0 | $0 | $0 |
Expenditures | $0 | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase |
Funding Source: | [ X ] General [ ] Education [ ] Highway [ ] Other | |||
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METHODOLOGY:
This bill requires third-party sellers to provide certain information to online marketplaces and to
consumers. The bill makes the failure to do so a violation of the consumer protection act.
This bill contains penalties that may have an impact on the New Hampshire judicial and correctional systems. There is no method to determine how many charges would be brought as a result of the changes contained in this bill to determine the fiscal impact on expenditures. However, the entities impacted have provided the potential costs associated with these penalties below.
Judicial Council | FY 2022 | FY 2023 |
Public Defender Program | Has contract with State to provide services. | Has contract with State to provide services. |
Contract Attorney – Felony | $825/Case | $825/Case |
Contract Attorney – Misdemeanor | $300/Case | $300/Case |
Assigned Counsel – Felony | $60/Hour up to $4,100 | $60/Hour up to $4,100 |
Assigned Counsel – Misdemeanor | $60/Hour up to $1,400 | $60/Hour up to $1,400 |
It should be noted that a person needs to be found indigent and have the potential of being incarcerated to be eligible for indigent defense services. Historically, approximately 85% of the indigent defense caseload has been handled by the public defender program, with the remaining cases going to contract attorneys (14%) or assigned counsel (1%). Beginning in March of 2021, the public defender program has had to close intake to new cases due to excessive caseloads. Due to these closures, the contract and assigned counsel program have had to absorb significantly more cases. The system is experiencing significant delays in appointing counsel and the costs of representation have increased due to travel time and multiple appointments. | ||
Department of Corrections | FY 2022 | FY 2023 |
FY 2021 Average Cost of Incarcerating an Individual | $54,386 | $54,386 |
FY 2021 Annual Marginal Cost of a General Population Inmate | $5,715 | $5,715 |
FY 2021 Average Cost of Supervising an Individual on Parole/Probation | $603 | $603 |
NH Association of Counties | FY 2022 | FY 2023 |
County Prosecution Costs | Indeterminable | Indeterminable |
Estimated Average Daily Cost of Incarcerating an Individual | $105 to $125 | $105 to $125 |
This bill contains penalties that will have an indeterminable impact on the Judicial Branch system. There is no method to determine how many charges would be brought as a result of the changes contained in this bill to determine the fiscal impact on expenditures. In the past the Judicial Branch has used averaged caseload data based on time studies to estimate the fiscal impact of proposed legislation. The per case data on costs for routine criminal cases currently available to the Judicial Branch are based on studies of judicial and clerical weighted caseload times for processing average routine criminal cases that are more than fifteen years old so the data does not have current validity. A new case study is being conducted and updated estimates will be available in the future.
The Department of Justice (DOJ) states this bill would allow it to investigate and pursue civil and criminal actions under the Consumer Protection Act for violations of this proposed statute. The bill would require third-party sellers to provide banking, advertising, and contact information to be verified by online marketplaces. It further requires these marketplace annually to request updates to the information from the sellers and to certify if the information remains unchanged. The bill allows the DOJ to adopt rules related to the collection and verification of the information. The DOJ indicates the fiscal impact of the enforcement provision is indeterminable because it is not possible to predict how many enforcement actions the DOJ would bring. Depending on the number of actions, the DOJ may need additional resources to fulfill its obligations.
AGENCIES CONTACTED:
Judicial Branch, Departments of Corrections and Justice, Judicial Council, and New Hampshire Association of Counties
