INFORM Consumers Act
The INFORM Consumers Act (Integrity, Notification, and Fairness in Online Retail Marketplaces for Consumers Act) is a United States federal law enacted in 2022 as part of the Consolidated Appropriations Act. Its primary goal is to increase transparency in online marketplaces and protect consumers from the sale of counterfeit, unsafe, and stolen goods by anonymous, high-volume third-party sellers. The law requires online marketplaces like Amazon, eBay, and Etsy to collect, verify, and disclose specific business information about sellers who meet a certain volume of transactions. The Federal Trade Commission (FTC) is the primary agency responsible for enforcing the Act.
Why the INFORM Act Matters for Brand Protection
For decades, the anonymity of online marketplaces has been a haven for counterfeiters. The INFORM Act directly attacks this core vulnerability. For brand owners, this legislation is a powerful new tool in the fight against fakes. It matters because it:
Increases Counterfeiter Accountability: By forcing sellers to reveal their true identity, it removes the shield of anonymity, making it easier for brands to identify and pursue legal action against bad actors.
Deters Illicit Activity: The risk of being identified and prosecuted discourages many would-be counterfeiters from listing fake goods in the first place.
Empowers Brands and Consumers: The disclosed information allows brands to more effectively police marketplaces for infringing listings and gives consumers a way to vet sellers, building trust in authentic products.
Shifts Responsibility to Marketplaces: The law places a clear compliance and verification burden on the platforms themselves, incentivizing them to be more proactive in policing their own ecosystems.
While the INFORM Act addresses the "who" behind the sale, it doesn't solve the problem of verifying the authenticity of the product itself. This is where a robust brand protection strategy becomes the critical next step in securing the digital marketplace.
INFORM Act: Key Provisions for High-Volume Sellers
The law's requirements are targeted specifically at sellers who conduct a high volume of transactions—defined as 200 or more discrete sales in a 12-month period amounting to $5,000 or more. For these sellers, online marketplaces must:
Requirement | Brand Protection Relevance |
|---|---|
Verification of Bank Account | Marketplaces must verify the seller's bank account information, ensuring a direct financial link to a real-world entity. |
Verification of Tax ID | Sellers must provide and verify a valid tax identification number, further tying their online identity to their legal business identity. |
Disclosure of Contact Information | Marketplaces must provide a clear way for consumers to access the seller's name, business address, and contact information directly on the product listing page. |
High-Value Transaction Reporting | For sellers conducting over $20,000 in annual transactions, marketplaces must provide an annual disclosure to consumers who purchase from them, including contact details and a direct link to report suspicious activity. |
INFORM Act in Action: Real-World Brand Protection
The INFORM Act provides the "who," but savvy brands know they need to control the "what." A counterfeit seller can still register a business and attempt to sell fakes, even with the new transparency rules. The ultimate defense is empowering consumers and marketplace investigators to instantly verify the product's authenticity at the point of discovery—whether it's in an online listing or after delivery.
This is where Ennoventure's technology creates a powerful synergy with the INFORM Act. Imagine a consumer browsing an online marketplace for a high-end luxury apparel item. The listing shows the seller's verified information per the INFORM Act. But how can the consumer trust the product in the photos is real?
With Ennoventure, the brand can embed an invisible cryptographic signature in the product's packaging or on a hang tag. The brand can then include a call-to-action in its marketing: "Verify your product's authenticity with your phone." When the item arrives, the consumer scans it. A positive result confirms they have a genuine product, building immense brand loyalty. A negative result provides irrefutable evidence of a counterfeit, which they can report to the marketplace and the FTC using the seller's now-disclosed contact information.
This combination of seller transparency (INFORM Act) and product authentication (Ennoventure) creates a formidable barrier to counterfeiting in e-commerce. It shifts the power from the anonymous seller to the informed consumer and the proactive brand. This is the future of empowering stakeholders in the fight against fakes.
How Ennoventure Complements the INFORM Act
Ennoventure's solutions address the product authentication gap that the INFORM Act leaves open, creating a comprehensive e-commerce security strategy.
INFORM Act Goal | Ennoventure Solution | Relevant Resource |
|---|---|---|
Protect consumers from counterfeit goods. | Provides consumers with a definitive, on-demand tool to verify product authenticity before or after purchase. | |
Increase accountability for bad actors. | A failed authentication scan creates concrete digital evidence that can be used alongside the seller's disclosed information to file complaints and pursue legal action. | |
Build trust in online marketplaces. | Brands can guarantee the authenticity of products sold online, regardless of the third-party seller, reinforcing consumer confidence. | |
Deter the listing of counterfeit items. | Knowing that consumers can easily verify authenticity makes selling fakes a much riskier and less profitable endeavor for counterfeiters. |
Frequently Asked Questions
Does the INFORM Act apply to all online sellers?
No. It specifically targets "high-volume" third-party sellers who meet the thresholds of 200+ sales and $5,000+ in revenue over a 12-month period. It does not apply to individual, casual sellers.
As a brand, what do I need to do to comply with the INFORM Act?
The compliance burden is on the online marketplaces, not the brands. However, brands should proactively monitor marketplaces for infringing listings and use the new transparency to their advantage when taking action against counterfeiters.
Will this law stop all counterfeits on marketplaces?
It is a significant step forward, but not a complete solution. Determined counterfeiters will still try to find ways around the rules. That's why combining the law's transparency with robust product authentication technology is the most effective strategy.
Go Beyond Seller Transparency to Secure Your Brand
The INFORM Consumers Act has changed the game for online sellers, but the fight against fakes is far from over. Take control of your brand's integrity by giving every consumer the power to verify your products. Pair the law's transparency with unforgeable product security to win the war on counterfeits.