Buckeye Reporter

A new proposed bill from Ohio state Reps. Phil Plummer (R-Dayton) and Haraz Ghanbari (R-Perrysburg would place regulations on online marketplaces to protect consumers from purchasing counterfeit or stolen items. 

House Bill 272 (HB 272) would require verification from sellers on online platforms and marketplaces, such as a business ID and address of operation, according to a report from 10TV WBNS. 

The bill has been proposed as part of a solution to combat online crime. Alex Boehnke, manager of Public Affairs for the Ohio Council of Retail Merchants, which represents more than 7,000 businesses across the state, said consumers purchasing items from online marketplaces may not even know they are buying stolen or counterfeit goods. 

“It used to be when organized retail crime rings steal products from one of our members' stores and take them to a pawn shop and try to pedal them that way,” Boehnke said. “Some of these online marketplaces have become a more convenient outlet.”

The problem of fake goods is ubiquitous. Fast Co. reports that Amazon blocked 10 billion attempted counterfeit listings last year and destroyed 2 million fake items in its warehouses. Counterfeit goods include staples like soap, infant formula and reusable water bottles. The website reports around 80% of counterfeit goods in the U.S. come from Hong Kong and China.

This exact situation happened in northern Ohio when the Ohio State Highway Patrol was doing a vehicle search and found dozens of clothing items that were counterfeit Nike, 10TV WBNS reported. 

In an interview with 10TV, Ghanbari said the bill will help give law enforcement more resources to investigate marketplaces online if those marketplaces have to screen and verify third-party sellers before allowing the seller to continue business through the site. 

“If you are fraudulent, you are not going to want to provide that information or maybe you are going to set up an account or cancel an account,” Ghanbari said, as reported by 10TV WBNS. “This will allow law enforcement officers to observe some of those red flags or criminal indicators.”

According to Buy Safe America, Ohio is one of three states considering laws to protect online shoppers from fraud and counterfeit goods. Pennsylvania and Delaware are the other two. Arkansas has just passed a version of the bill and 15 other states have considered it. The bill would protect consumers from online fraudulent goods and fakes, often sold on major online retail platforms by foreign companies.

It has in-state support of Ohio Manufacturers' Association Public Policy Services Director Rachel Carl.

“Ohio manufacturers are the largest contributing sector to the state’s GDP," Carl said in a release. "In 2018, they produced more than $112.2 billion worth of goods. As the prevalence of fake and stolen merchandise sales rises, it is important that online retailers have a basic knowledge of third-party sellers. Requiring validation of these sellers on the front end will allow Ohio manufacturers to protect their brand and safeguard their intellectual property. Moreover, it will create seller transparency for consumers and ensuring customer trust in the products they are buying.”

Other proponents of the bill in Ohio include the Ohio Chemistry Technology Council, The Game Manufacturers Association, Retail Industry Leaders Association, Ohio Grocers Association, Ohio Manufacturers' Association, Meijer, The Toy Association, Walgreens, Home Depot, and Walmart, according to 10TV WBNS. 

HB 272 is currently being considered in the House Commerce and Labor Committee awaiting advancement.