H.F. 2401 Section 1. NEW SECTION . 554E.1 Definitions. 1 As used in this chapter, unless the context otherwise 2 requires: 3 1. “Consumer product” means goods that are used or bought 4 for use primarily for personal, family, or household purposes. 5 2. “High-volume third-party seller” means a participant on 6 an online marketplace platform who is a third-party seller 7 and who, in any continuous twelve-month period during the 8 previous twenty-four months, has entered into two hundred or 9 more discrete sales or transactions of new or unused consumer 10 products made through the online marketplace and for which 11 payment was processed by the online marketplace, either 12 directly or through its payment processor, and an aggregate 13 total of five thousand dollars or more in gross revenues. 14 3. “Online marketplace” means a person or entity that 15 operates a consumer-directed electronically based or accessed 16 platform as follows: 17 a. The platform includes features that allow for, 18 facilitate, or enable third-party sellers to engage in the 19 sale, purchase, payment, storage, shipping, or delivery of a 20 consumer product in the state. 21 b. The platform is used by one or more third-party sellers 22 for the purposes specified in paragraph “a” . 23 c. The platform has a contractual or similar relationship 24 with consumers governing their use of the platform to purchase 25 consumer products. 26 4. “Seller” means a person who sells, offers to sell, 27 or contracts to sell a consumer product through an online 28 marketplace platform in the state. 29 5. “Third-party seller” means a seller, independent of an 30 online marketplace, who sells, offers to sell, or contracts 31 to sell a consumer product in the state through an online 32 marketplace platform. The term “third-party seller” does not 33 include, with respect to an online marketplace, the following: 34 a. A seller who operates an online marketplace platform. 35 -1- HF 2401 (2) 89 es/rn/md 1/ 7

H.F. 2401 b. A business entity that has made available to the general 1 public the entity’s name, business address, and working contact 2 information; that has an ongoing contractual relationship with 3 the online marketplace to provide the online marketplace with 4 the manufacture, distribution, wholesaling, or fulfillment of 5 shipments of consumer products; and that has provided to the 6 online marketplace identifying information, as described in 7 section 554E.2, that has been verified in accordance with that 8 section. 9 6. “Verify” means to confirm information provided to 10 an online marketplace pursuant to this chapter, which may 11 include the use of one or more methods that enable the online 12 marketplace to reliably determine that any information and 13 documents provided are valid, corresponding to the seller or an 14 individual acting on the seller’s behalf, not misappropriated, 15 and not falsified. 16 Sec. 2. NEW SECTION . 554E.2 Collection of information. 17 1. An online marketplace shall require any high-volume 18 third-party seller on an online marketplace platform to 19 provide, not later than ten days after qualifying as a 20 high-volume third-party seller on the platform, the following: 21 a. A bank account number, or, if such seller does not have a 22 bank account, the name of the payee for payments issued by the 23 online marketplace to such seller. 24 b. The seller’s contact information. 25 c. A business tax identification number, or, if such seller 26 does not have a business tax identification number, a taxpayer 27 identification number. Any information contained in such 28 document shall be presumed to be verified as of the date of 29 issuance of such document. 30 d. A current working email address and phone number for such 31 seller. 32 2. The bank account or payee information required under this 33 section may be provided by the seller as follows: 34 a. To the online marketplace. 35 -2- HF 2401 (2) 89 es/rn/md 2/ 7

H.F. 2401 b. To a payment processor or other third party contracted by 1 the online marketplace to maintain such information, provided 2 that the online marketplace ensures that it can obtain such 3 information on demand from such payment processor or other 4 third party. 5 3. Acceptable forms of seller contact information include 6 the following: 7 a. With respect to a high-volume third-party seller that is 8 an individual, the individual’s name. 9 b. With respect to a high-volume third-party seller that 10 is not an individual, one of the following forms of contact 11 information: 12 (1) A copy of a valid government-issued identification for 13 an individual acting on behalf of such seller that includes the 14 individual’s name. 15 (2) A copy of a valid government-issued record or tax 16 document that includes the business name and physical address 17 of such seller. Any information contained in such document 18 shall be presumed to be verified as of the date of issuance of 19 such document. 20 4. An online marketplace shall verify the information 21 collected under this section not later than ten days after 22 collection. 23 Sec. 3. NEW SECTION . 554E.3 Information updates. 24 1. An online marketplace shall do the following: 25 a. Periodically, but not less than annually, notify a 26 high-volume third-party seller on an online marketplace 27 platform of the requirement to keep any information collected 28 under this chapter current. 29 b. Require a high-volume third-party seller on an online 30 marketplace platform to, not later than ten days after 31 receiving the notice under this section, electronically certify 32 that the following: 33 (1) That the seller has provided any changes to such 34 information to the online marketplace, if any such changes have 35 -3- HF 2401 (2) 89 es/rn/md 3/ 7

H.F. 2401 occurred. 1 (2) That there have been no changes to such seller’s 2 information. 3 (3) That the seller has provided any changes to such 4 information to the online marketplace. 5 2. An online marketplace shall verify any change to such 6 information not later than ten days after being notified of the 7 change by a high-volume third-party seller under this section. 8 Sec. 4. NEW SECTION . 554E.4 Suspension. 9 In the event that a high-volume third-party seller does not 10 provide the information or certification required under this 11 chapter, the online marketplace shall, after providing the 12 seller with written or electronic notice and an opportunity 13 to provide such information or certification not later than 14 ten days after the issuance of such notice, suspend any future 15 sales activity of the seller until the seller provides such 16 information or certification. 17 Sec. 5. NEW SECTION . 554E.5 Data collection. 18 1. Data collected solely to comply with the requirements 19 of this section may not be used for any other purpose unless 20 required by law. 21 2. An online marketplace shall implement and maintain 22 reasonable security procedures and practices, including 23 administrative, physical, and technical safeguards, appropriate 24 to the nature of the data and the purposes for which the data 25 will be used, to protect the data collected to comply with the 26 requirements of this section from unauthorized use, disclosure, 27 access, destruction, or modification. 28 Sec. 6. NEW SECTION . 554E.6 Disclosure requirements. 29 1. An online marketplace shall do the following: 30 a. Require a high-volume third-party seller with an 31 aggregate total of twenty thousand dollars or more in annual 32 gross revenues on an online marketplace, and that uses an 33 online marketplace platform, to provide the information as 34 specified in subsection 2 to the online marketplace. 35 -4- HF 2401 (2) 89 es/rn/md 4/ 7

H.F. 2401 b. Disclose the information described in this section 1 to consumers in a clear and conspicuous manner in the order 2 confirmation message or other document or communication made 3 to the consumer after the purchase is finalized and in the 4 consumer’s account transaction history. 5 2. A high-volume third-party seller subject to this section 6 shall disclose the following: 7 a. The full name of the seller, which may include the 8 seller’s name or seller’s company name, or the name by which 9 the seller or company operates on the online marketplace. 10 b. The physical address of the seller. 11 c. Contact information for the seller, to allow for the 12 direct, unhindered communication with high-volume third-party 13 sellers by users of the online marketplace, including a current 14 working phone number, a current working email address, or other 15 means of direct electronic messaging which may be provided to 16 the seller by the online marketplace. 17 d. When a high-volume third-party seller uses a different 18 seller to supply the consumer product to the consumer upon 19 purchase, and upon the request of an authenticated purchaser, 20 the information described in this section relating to any such 21 seller that supplied the consumer product to the purchaser, if 22 the seller is different than the high-volume third-party seller 23 listed on the product listing prior to purchase. 24 3. An online marketplace shall disclose to consumers in 25 a clear and conspicuous manner on the product listing of the 26 high-volume third-party seller a reporting mechanism that 27 allows for electronic and telephonic reporting of suspicious 28 marketplace activity to the online marketplace. 29 4. If a high-volume third-party seller does not comply with 30 the requirements to provide and disclose information under this 31 section, the online marketplace shall, after providing the 32 seller with written or electronic notice and an opportunity to 33 provide or disclose such information not later than ten days 34 after the issuance of such notice, suspend any future sales 35 -5- HF 2401 (2) 89 es/rn/md 5/ 7

H.F. 2401 activity of the seller until the seller complies with the 1 requirements. 2 Sec. 7. NEW SECTION . 554E.7 Exceptions. 3 1. Subject to section 554E.6, upon the request of a 4 high-volume third-party seller, an online marketplace may 5 provide for partial disclosure of the identity information 6 required under section 554E.6 as follows: 7 a. If the seller certifies to the online marketplace that 8 the seller does not have a business address and only has a 9 residential street address, or has a combined business and 10 residential address, the online marketplace may disclose only 11 the country and, if applicable, the state in which such seller 12 resides; and inform consumers that there is no business address 13 available for the seller and that consumer inquiries should 14 be submitted to the seller by phone, email, or other means of 15 electronic messaging provided to such seller by the online 16 marketplace. 17 b. If the seller certifies to the online marketplace 18 that the seller is a business that has a physical address 19 for product returns, the online marketplace may disclose the 20 seller’s physical address for product returns. 21 c. If the seller certifies to the online marketplace that 22 the seller does not have a phone number other than a personal 23 phone number, the online marketplace shall inform consumers 24 that there is no phone number available for the seller and that 25 consumer inquiries should be submitted to the seller’s email 26 address or other means of electronic messaging provided to such 27 seller by the online marketplace. 28 2. If an online marketplace becomes aware that a high-volume 29 third-party seller has made a false representation to the 30 online marketplace in order to justify the provision of a 31 partial disclosure under section 554E.6 or that a high-volume 32 third-party seller who has requested and received a provision 33 for a partial disclosure under section 554E.6 has not provided 34 responsive answers within a reasonable time frame to consumer 35 -6- HF 2401 (2) 89 es/rn/md 6/ 7

H.F. 2401 inquiries submitted to the seller by phone, email, or other 1 means of electronic messaging provided to such seller by 2 the online marketplace, the online marketplace shall, after 3 providing the seller with written or electronic notice and 4 the opportunity to respond not later than ten days after the 5 issuance of such notice, suspend any future sales activity of 6 such seller unless such seller consents to the disclosure of 7 the identity information required under section 554E.6. 8 Sec. 8. NEW SECTION . 554E.8 Enforcement —— penalties. 9 1. If the attorney general has reasonable belief that 10 an online marketplace is in violation of this chapter, the 11 attorney general has the sole authority to bring civil action 12 to provide for all of the following: 13 a. Enjoin further violations by the online marketplace. 14 b. Enforce compliance with this chapter. 15 c. Assess civil penalties in an amount not more than one 16 hundred thousand dollars. 17 d. Obtain other remedies permitted under law. 18 e. Obtain damages, restitution, or other compensation on 19 behalf of residents of the state. 20 2. This chapter shall not be construed to prevent the state 21 from exercising the power to conduct investigations, administer 22 oaths or affirmations, or compel the attendance of witnesses or 23 the production of documentary and other evidence. 24 3. The attorney general may adopt rules as necessary to 25 implement this chapter. 26 Sec. 9. NEW SECTION . 554E.9 Severability. 27 If any provision of this chapter or the application 28 thereof to any person or circumstances is held invalid, the 29 validity shall not affect other provisions or applications 30 of the chapter which can be given effect without the invalid 31 provisions or application and, to this end, the provisions of 32 this chapter are severable. 33 Sec. 10. EFFECTIVE DATE. This Act takes effect January 1, 34 2023. 35 -7- HF 2401 (2) 89 es/rn/md 7/ 7