In today’s digital age, e-commerce has become an integral part of our lives, with Americans spending over $1 trillion online for the first time in history last year. However, as the online shopping landscape continues to flourish, so does the threat of counterfeit products. U.S. Senators Chris Coons (D-Del.) and Thom Tillis (R-N.C.) have taken a significant step to protect consumers from potentially harmful counterfeit goods sold on e-commerce platforms. Their joint initiative, known as the “Stopping Harmful Offers on Platforms by Screening Against Fakes in E-Commerce” (SHOP SAFE) Act, aims to address this growing concern.
The rapid growth of e-commerce has provided consumers with unprecedented convenience and access to a wide array of products, from toys and electronics to clothing and car parts. However, this convenience comes with a dark side: an increasing vulnerability to counterfeit goods, which can pose significant risks to consumer health and safety. Counterfeit products, often originating from various sources, are finding their way into the online marketplace. The SHOP SAFE Act is designed to reduce the availability of such harmful counterfeit goods by encouraging e-commerce platforms to adopt best practices for vetting sellers and goods and by curbing repeat counterfeiter sellers.
Senator Coons underlined the urgency of this legislation, stating, “As Americans have increasingly turned to e-commerce for convenience, selection, and safety, some third-party sellers have begun to exploit consumers’ trust in established online marketplaces to trick them into purchasing dangerous counterfeit goods. These counterfeit goods pose health and safety risks, damage the reputations of legitimate brands, and line the pockets of organized crime. The bipartisan SHOP SAFE Act is an important step that will protect consumers and encourage greater transparency and accountability.”
As more Americans continue to rely on online shopping, the threat of counterfeit sales, often originating from overseas, remains a pressing concern. The SHOP SAFE Act addresses this challenge head-on. Senator Tillis emphasized the Act’s potential to safeguard consumers from these dangerous products, noting that “with Americans continuing to rely on online shopping, it’s crucial that we do all we can to protect consumers from dangerous counterfeit sales, which are often coming from China.”
The SHOP SAFE Act outlines several key provisions:
- Trademark Infringement Liability: E-commerce platforms will face liability for trademark infringement when a third-party seller offers counterfeit products that endanger consumer health or safety, and the platform has not implemented specific best practices.
- Advanced Notice to Platforms: Brand owners will be required to provide e-commerce platforms with advanced notice of their trademarks and a designated point of contact. This information will enable platforms to proactively prevent the sale of counterfeit goods.
- Safe Harbor for Compliant Platforms: Platforms that thoroughly vet sellers for legitimacy, remove counterfeit listings, and take action against repeat offenders will be granted a safe harbor from liability.
Senator Coons, as Chair of the Senate Judiciary Committee’s Intellectual Property Subcommittee, has been a long-standing advocate for protecting U.S. intellectual property rights and consumers from counterfeit goods. In line with these efforts, he held a hearing on the oversight of the U.S. Patent and Trademark Office (USPTO) in July, aimed at ensuring that U.S. intellectual property laws are effectively enforced.
Furthermore, Senators Coons and Chuck Grassley (R-Iowa) introduced a bipartisan resolution in July, designating August as National Anti-Counterfeiting and Consumer Education and Awareness Month. This resolution highlighted the vital role of trademarks in protecting consumer safety and the American economy.
The SHOP SAFE Act enjoys support from industry organizations and associations such as the American Apparel & Footwear Association, the Alliance for Automotive Innovation, the Toy Association, the National Association of Manufacturers, the Footwear Distributors and Retailers of America, and the Council for Innovation Promotion.
Steve Lamar, President and CEO of the American Apparel & Footwear Association, applauded the leadership and commitment of Senators Coons and Tillis in the fight against counterfeit products. He emphasized that the legislation levels the playing field for online platforms, ensuring that they meet the same standards of accountability as traditional retailers.
Hilary Cain, Vice President of Technology, Innovation, and Mobility Policy at the Alliance for Automotive Innovation, highlighted the importance of the Act in preventing counterfeit auto parts from reaching consumers, which could endanger public health and safety.
Steve Pasierb, President and CEO of The Toy Association, expressed gratitude for the legislation, noting that it holds online marketplaces accountable for the products they offer, safeguarding children and families from potentially dangerous counterfeits.
Charles Crain, Vice President of Domestic Policy at the National Association of Manufacturers, commended Senators Coons and Tillis for their commitment to protecting American citizens, workers, and businesses from counterfeit products.
Matt Priest, President and CEO of the Footwear Distributors and Retailers of America, underlined the significance of the SHOP SAFE Act in the battle against counterfeit footwear, which not only puts consumers at risk but also threatens jobs in the industry.
In conclusion, the SHOP SAFE Act represents a crucial step in the ongoing fight against counterfeit products in the digital age. As e-commerce continues to flourish, this legislation aims to create a safer and more trustworthy online shopping environment, ultimately safeguarding consumers and preserving the integrity of brands and industries. With bipartisan support and backing from industry leaders, the Act signals a proactive approach to addressing the challenges posed by counterfeit goods in the modern marketplace.
