California lawmakers are moving swiftly to tackle the issue of retail theft with a new bill targeting high-volume online sellers.
This proposed legislation mandates that platforms like eBay and OfferUp collect banking details and tax identification numbers from sellers who advertise online but collect payments offline. The aim is to curb the resale of stolen merchandise by making it easier to track down sellers.
Rationale Behind the Bill
The bill is part of a broader legislative package comprising 14 bills aimed at combating retail theft in California. The California Retailers Association supports this measure, asserting that retail theft has reached crisis levels.
However, quantifying the extent of the problem is challenging since many retailers do not share their data.
Details of the Proposal
The proposal specifies that sellers who make at least $5,000 in profit and engage in a minimum of 200 transactions per year must provide their banking details and tax identification numbers.
Proponents, including district attorneys and major retailers, believe this data collection will dismantle organized theft rings reselling stolen goods. They argue it closes a loophole in existing laws that do not require online platforms to track offline transactions.
Opposition and Concerns
Despite its intended benefits, the bill has faced criticism for being overly broad and vague. Opponents argue that it could force platforms to collect sensitive information from all users, potentially harming California’s e-commerce businesses.
David Edmonson of TechNet, a technology advocacy group, expressed concerns that the new requirements might deter sellers from using online marketplaces to sell household items.
According to the source, Nathan Garnett, general counsel of OfferUp, warned that the bill would significantly benefit big-box retailers while crippling classified ad sites.
He noted that OfferUp’s 11 million users in California would need to provide personal information before listing items, which could discourage casual sellers from using the platform.
Comparison with Federal Law
Opponents also highlight that the measure conflicts with a federal law implemented last July. This federal legislation requires online marketplaces like Amazon to verify high-volume sellers, aiming to reduce the resale of stolen goods.
Carl Szabo, general counsel of NetChoice, argues that the federal law was designed to protect classified websites and that the California bill would impose unnecessary and burdensome requirements.
Support from Lawmakers
Democratic state Senator Nancy Skinner, who authored the bill, contends that law enforcement needs this tool to combat professional reselling schemes.
She cited a case in San Diego where a couple made approximately $8 million from selling stolen goods online. Skinner emphasized that the bill would only require information from high-volume sellers, not every user of these platforms.
Legislative Package and Broader Context
The proposed bill is part of a legislative package that includes measures to increase penalties for organized crime rings, expand drug court programs, and close loopholes to facilitate auto theft prosecutions.
Lawmakers are working to deliver these bills to Governor Gavin Newsom within a few weeks, with the intention of implementing them immediately. This package represents a new strategy to address voter concerns about crime while maintaining progressive policies aimed at reducing incarceration.
Conclusion
This bill represents a significant effort by California lawmakers to combat retail theft by targeting high-volume online sellers. While it has garnered support from major retailers and law enforcement, it has also faced substantial opposition from e-commerce advocates and platforms like OfferUp.
As the legislative process unfolds, the debate over balancing the need for robust anti-theft measures with the potential impact on e-commerce businesses will continue
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