Measures to target fake products, help private equity make it into year-end spending bill
- Private Equity
- December 22, 2022
- No Comment
A measure that takes aim at the sale of counterfeit products in online marketplaces has found a place in Washington’s year-end spending bill, which Congress looks on track to pass by the end of this week.
A separate provision that’s favorable to the private equity industry also has made it into the $1.7 trillion omnibus bill, which includes a wide range of items known as policy riders.
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The measure targeting fake goods, known as the INFORM Consumers Act, requires e-commerce sites to verify and disclose information about their high-volume third-party sellers. It made the cut after being left out of the bipartisan Chips and Science Act over the summer and after a lobbying battle over how to address counterfeit products.
“Notably, the legislation is supported by Amazon
and other marketplaces as it’s seen as a watered-down bill that would head off more stringent legislation like the SHOP SAFE Act,” wrote Ben Koltun, director of research at Beacon Policy Advisors, in a note.
TechNet, which counts Amazon and eBay
among its members, said in a letter last week in support of the INFORM Consumers Act that the legislation would “establish a uniform national standard that sellers could follow to share information about their products, but is structured so as to not expose small sellers to compliance risk.”
Meanwhile, the National Retail Federation applauded congressional negotiators for including the INFORM Consumers Act in the omnibus package, saying the measure “will help curb the fencing of stolen merchandise and address the sale of counterfeit goods, which are common tactics of organized retail crime (ORC) groups.”
The National Association of Manufacturers also praised lawmakers for including the measure, describing it as one of the manufacturing industry’s most important priorities, while also criticizing Congress for failing to bring back immediate tax deductions for research-and-development costs.
The provision helping private equity, meanwhile, “strongly encourages” the Securities and Exchange Commission to repeat its economic analysis for a proposed regulation for private funds. It also encourages the SEC to “extend comment periods to a length that is appropriate for the complexity and potential impact of the rule.”
The SEC’s proposed regulation would “require private funds to give investors quarterly statements with information on fees, expenses and performance, and to undergo annual audits,” said Ian Katz, a Capital Alpha Partners analyst, in a note. “The plan, as we noted when it was released, seriously displeased the private equity and hedge fund industries.”
From MarketWatch’s archives (February 2022): Gensler’s aggressive agenda continues at the SEC
The American Investment Council, which lobbies for private equity, told Politico that the inclusion of the provision “proves once again that there is growing bipartisan concern that [SEC Chair Gary Gensler] is moving too fast on extreme regulations without considering how proposals will impact small businesses and private investment.”
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