AAFA Applauds House Movement of Inform Consumers and Encourages Forward Momentum by the Senate

November 17, 2022 | WASHINGTON, D.C.
The American Apparel & Footwear Association commends the U.S. House of Representatives for its passage of the Integrity, Notification, and Fairness in Online Retail Marketplaces (INFORM) Consumers Act [H.R. 5502].

The INFORM Consumers Act promises to help to provide additional information to consumers and provide law enforcement with the vital enforcement tools needed to go after high-volume third-party criminal sellers, who offload illicit merchandise across e-commerce marketplaces.

“We were pleased to see the House pass the INFORM Consumers Act, an important first step in the effort to keep counterfeits off of popular marketplaces and out of consumers homes," Steve Lamar, AAFA president and CEO. "The United States must lead in efforts to eradicate illicit and counterfeit items that are flourishing. This means the Senate now needs to take up and pass this measure AND both chambers need to pass the complementary SHOP SAFE Act. Both measures are needed to keep dangerous products from multiplying online during this holiday shopping season."

Earlier this year, AAFA released the results of a study conducted with Intertek, a highly respected international total quality assurance provider, to test counterfeit products for a range of hazardous chemicals and heavy metals. The study found that 36.2 percent of the products tested failed to comply with U.S. product safety standards, including dangerous levels of arsenic, cadmium, phthalates, lead, and more that have been shown to cause adverse health outcomes.

In October, AAFA quantified the current online counterfeiting problem and detailed the costs to members in navigating the current status quo in AAFA’s submission for the 2022 Special 301 Out-of-Cycle Review of Notorious Markets with the Office of the United States Trade Representative (USTR). AAFA’s comments illustrate how bilateral conversations with platforms and the burden of information required by brands per reporting tool does not solve the problem as members found when calculating counterfeits – almost 100% of goods calculated by brands when searching online in some instances.  SHOP SAFE would help to bring platforms to the table to provide brands the partnership needed to really address the counterfeiting problem, protecting consumers.

Nefarious counterfeiters, masked behind the anonymity provided by online platforms due to little, or no, front-end verification, can take advantage of consumers. Never has the counterfeit problem been at the scale it is today, from dupe influencers, fraudulent advertisements, and fake websites to the actual counterfeit products being sold to unwitting consumers across platforms – this is a full online destructive digital value chain. AAFA calls for immediate action to bring reprieve to U.S. businesses and to protect consumers until long-term solutions are realized.