On December 29, 2022, the Integrity, Notification, and Fairness in Online Retail Marketplaces for Consumers Act (the “INFORM Consumers Act” or “INFORM Act”) was signed into law. The INFORM Act was a last-minute addition to the Consolidated Appropriations Act of 2023, an omnibus bill that authorizes federal government spending for the upcoming year.
The INFORM Consumers Act aims to create a safe and transparent online buying process by placing new obligations on Storenvy and “high-volume” third-party sellers who sell products through the Storenvy marketplace.
All “online marketplaces” were required to implement policies, procedures, and controls to comply with the Inform Act by June 27, 2023. To the extent a seller on an online marketplace does not supply any related required information about its business, the online marketplace must suspend that seller’s account within 10 days of initially requesting such information.
Here is how this law may impact you:
If you are considered a "high volume seller", which is defined as someone who has sold 200 or more new items through the Storenvy marketplace totaling $5,000 of more in any 12 consecutive months over the last 24 months, the following will be necessary (note that sales through your custom storefront are not part of this calculation):
1) Your provided phone number and email address must be verified. For the time being, our team will contact you directly using the details on file with your account to complete these verifications.
2) We must verify your identity (business or individual) and your provided physical address. If you are selling as an individual, you will be required to provide a copy of your driver’s license or passport. On the other hand, if you are selling as a business, you will be required to provide a government issued business document which includes the business name and physical address on file with your account. The following are the most common business verification documents which will be accepted:
- Articles of Incorporation
- Business License
- Trust instrument
- Certified Articles of Organization
- Certificate of Registration
- Certificate of Formation
- Certificate of Incorporation
- IRS 147C EIN verification letter
- Tax returns (can be redacted)
If you are a "seller requiring disclosure", defined as any seller with total annual revenue of $20,000 through the Storenvy marketplace, the following will be required (note that sales through your custom storefront are not part of this calculation):
1) We must make your name (or company name) and physical address accessible, as well as details on whether you use other businesses (i.e. dropshippers) to fulfill any or all of your orders, from your product pages. For the time being, we will contact you directly to confirm any necessary details we do not currently have on file.
2) We must add a reporting mechanism to allow consumers to easily report suspicious activity on your product listings via phone or email. These requests will be directed to Storenvy and should not have any operational impact on your business.
If any action or information is required from you, we will reach out to you via email or phone.