The INFORM Consumers Act and Auction Houses: What It Asks

What is the INFORM Consumers Act?

INFORM stands for Integrity, Notification, and Fairness in Online Retail Marketplaces for Consumers. It's a federal law meant to make it harder to sell stolen, counterfeit or unsafe goods anonymously online, and it took effect on June 27, 2023.

The duties fall mainly on online marketplaces, the platforms where third parties sell to consumers. A seller's part is to provide accurate information when asked and to keep it current.

Who counts as a high-volume third-party seller?

In general, a seller who, in any continuous 12-month period, makes 200 or more separate sales and $5,000 or more in gross revenue through a marketplace. The law counts sales of new or unused consumer products, a detail worth raising with your attorney if you sell mostly used goods.

An auction house that sells regularly online can reach 200 sales quickly, since each lot sold can count as a sale. Whether your house qualifies, and on which platforms, is a question for an attorney, not a web page.

What information do marketplaces have to collect?

In general, the law asks marketplaces to collect and verify the following from each high-volume seller, and to have sellers confirm it's still current at least once a year. Sellers who don't provide it can have their sales suspended until they do.

• Bank account information.
• The seller's name, or for a business, a government-issued record or tax document showing its legal name and physical address.
• A business tax identification number or taxpayer identification number.
• A working email address and phone number.

What do buyers get to see?

For high-volume sellers with $20,000 or more in annual gross revenue on a marketplace, the law also requires the marketplace to show buyers the seller's name, physical address and contact information, with limited exceptions. It must also give buyers a clear way to report suspicious conduct.

For an auction house, much of this is public already: your name is on the sale, and pickup sales list your address. The law makes it a requirement rather than a courtesy. Tax IDs and bank details are collected and verified, not published.

What should an auction house do about INFORM?

Most of the work is housekeeping. Treat a marketplace's request for these details as routine, but confirm it really came from the marketplace before sending anything sensitive. Auktia, for example, collects seller information from every house, including legal name, address and tax ID, as the INFORM Consumers Act asks of online marketplaces.

1. Keep your legal name, address, tax ID and bank details consistent on every platform you sell through.
2. Answer marketplace information requests promptly, since a missed request can pause your sales.
3. Update your details when you move, change entities or change bank accounts.
4. Ask your attorney whether your house counts as high-volume, and on which platforms.

Where can you read the official rules?

Go to the source. The Federal Trade Commission publishes plain-language business guidance on the INFORM Consumers Act, and the full text of the law is public. The FTC and state attorneys general enforce it. Guidance can change, so check the FTC's current version rather than relying on any summary, this one included.

This page is a general summary, not legal advice. For how the law applies to your house, talk to an attorney. For Texas auctioneer licensing, check with TDLR, and for sales tax, the Texas Comptroller; our Texas auction sales tax guide is a starting point.