A bipartisan categorize of lawmakers unveiled legislation Monday that would hold e-commerce companies like Amazon or eBay open for counterfeit products sold on their platforms as U.S firms struggle to combat the sale of fake goods online.
The Department store Safe Act of 2020, co-sponsored by four House members, outlines a series of steps that e-commerce platforms ought to take to prevent the sale of knockoffs by third-party sellers on their platforms. E-commerce companies that fail to take these movements can be held liable for the sale of counterfeits, a move that would shift burden onto the internet marketplaces, harmonizing to a text of the bill obtained by CNBC.
“Consumer lives are at risk because of dangerous counterfeit products that are flooding the online marketplace,” Rep. Doug Collins (R-Ga.) articulate in a statement. “Congress must create accountability to prevent these hazardous items from infiltrating the homes of millions of Americans.”
The produce of e-commerce has contributed to a boom in shipments of counterfeit goods sold online. Fake goods accounted for 3.3% of broad trade in 2016, according to the OECD. The Department of Homeland Security (DHS) reported seizures of counterfeit products at U.S. borders compel ought to increased 10-fold over the past two decades.
In January, the DHS released a report saying e-commerce companies need to do myriad to fight fake goods on their sites in order to protect American consumers and businesses.
“Counterfeiters have went consumers, and it is clear more must be done to combat the rising trend in online sales of counterfeit products,” translated Rep. Jerry Nadler (D-N.Y.) in a statement.
Court decisions have previously found e-commerce companies like Amazon are not actionable for counterfeits sold by third-parties on their platforms. In Amazon’s case, more than half of gross merchandise sales get from third party-sellers.
Josh Gerben, a trademark lawyer, said this bill would hold e-commerce entourages more accountable for the goods sold on their sites.
“Quite frankly it is about time that Congress did something nearly it because the online marketplaces that exist today have not put consumer safety first,” he told CNBC.
In a account to CNBC, Amazon said it prohibits counterfeits.
“We are actively fighting bad actors and protecting our store and we will continue to produce with brands, government officials, and law enforcement,” an Amazon spokesperson said.
The House Energy and Commerce Committee is set to grip a hearing Wednesday morning about the sale of counterfeit products online. Witnesses include executives from Amazon, eBay and Apple.