Relates to certain procedural protections granted to third-party sellers and seller profiles of online marketplaces; provides that online marketplaces must provide notice and an opportunity to respond before a seller or profile is suspended; provides that a suspended third-party seller or seller profile shall have the right to appeal the determination of the online marketplace in seeking account reinstatement.
STATE OF NEW YORK
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9546--A
IN SENATE
March 23, 2026
___________
Introduced by Sens. SUTTON, BASKIN, HINCHEY, MYRIE, RAMOS, SALAZAR,
SKOUFIS, WEBB -- read twice and ordered printed, and when printed to
be committed to the Committee on Internet and Technology -- committee
discharged, bill amended, ordered reprinted as amended and recommitted
to said committee
AN ACT to amend the general business law, in relation to certain proce-
dural protections granted to third-party sellers and seller profiles
of online marketplaces
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The general business law is amended by adding a new article
2 48 to read as follows:
3 ARTICLE 48
4 FAIR AND TIMELY PROCESS FOR SUSPENDING THIRD-PARTY SELLERS AND SELLER
5 PROFILES OF ONLINE MARKETPLACES
6 Section 1705. Definitions.
7 1706. Third-party seller and seller profile pre-suspension warn-
8 ing period.
9 1707. Third-party seller and seller profile suspension and
10 appeals processes.
11 1708. Enforcement and penalties.
12 § 1705. Definitions. As used in this article:
13 1. "Online marketplace" means any person or entity that operates a
14 consumer-directed electronically based or accessed platform that
15 includes features that allow for, facilitate, or enable third-party
16 sellers and/or seller profiles to engage in the advertisement, display,
17 sale, purchase, payment, storage, shipping, and/or delivery of a consum-
18 er product in New York state; and is used by one or more third-party
19 sellers and/or seller profiles for such purposes.
20 2. "Third-party seller" means any person or entity, independent of an
21 online marketplace, who sells, offers to sell, or contracts to sell a
22 consumer product in New York state through such online marketplace's
23 platform.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD15192-05-6
S. 9546--A 2
1 3. "Seller profile" means any person or entity, independent of an
2 online marketplace, that uses an online marketplace to showcase or
3 otherwise advertise its business information in order to independently
4 solicit sales of consumer product.
5 4. "Consumer product" means any tangible personal property which is
6 advertised and/or distributed in commerce by a third-party seller or
7 seller profile through an online marketplace.
8 5. "Suspension" means action taken by an online marketplace to tempo-
9 rarily or permanently block selling privileges of third-party sellers or
10 seller profiles for alleged or actual policy or code of conduct
11 violations, performance issues, or account integrity problems, including
12 but not limited to product quality or authenticity, intellectual proper-
13 ty infringement, customer complaints or feedback, late shipments,
14 cancellations, pricing or listing issues, or customer service.
15 § 1706. Third-party seller and seller profile pre-suspension warning
16 period. 1. No online marketplace shall suspend a third-party seller or
17 seller profile without first providing a two-week warning period in
18 which the online marketplace:
19 (a) notifies the third-party seller or seller profile with reasonable
20 documentation and details related to any and all infractions used to
21 justify a particular suspension;
22 (b) allows the third-party seller or seller profile to offer any
23 defense or justification against alleged or actual culpability, as well
24 as the ability to cure any and all infractions that are used to justify
25 a particular suspension; and
26 (c) provides a reasonable response to any correspondence, communi-
27 cation, or outreach by a third-party seller or seller profile.
28 2. Such two-week warning period shall begin when an online marketplace
29 provides a third-party seller or seller profile with the notification
30 required in paragraph (a) of subdivision one of this section and may be
31 extended at the online marketplace's discretion in order to allow the
32 third-party seller or seller profile to cure any and all infractions for
33 the purposes of avoiding such suspension.
34 3. Where an online marketplace reasonably believes a third-party sell-
35 er or seller profile is engaged in imminent illegal activity, fraud,
36 deceit, misrepresentation, or similar abuses or deceptive practices with
37 impending effects to consumers within the marketplace, such online
38 marketplace may limit the third-party seller's or seller profile's
39 account capabilities during such two-week warning period.
40 § 1707. Third-party seller and seller profile suspension and appeals
41 processes. 1. An online marketplace shall designate a representative to
42 liaise with a third-party seller or seller profile who is actively
43 suspended or pending suspension, as well as provide such represen-
44 tative's contact information to such third-party seller or seller
45 profile. Such representative shall be within the online marketplace's
46 decision making department for suspensions and shall maintain consist-
47 ent, direct communication with a suspended third-party seller or seller
48 profile to work to resolve the issue leading to suspension.
49 2. A suspended third-party seller or seller profile shall have the
50 right to appeal the determination of the online marketplace in seeking
51 account reinstatement. Such appeals shall be acknowledged by the online
52 marketplace within one week of the appeal being made. An online market-
53 place shall acknowledge and reasonably respond to a suspended third-par-
54 ty seller's or seller profile's appeal within one week of the appeal's
55 submission.
S. 9546--A 3
1 3. Upon a final determination by the online marketplace to permanently
2 suspend a third-party seller or seller profile, the online marketplace
3 shall provide any and all documents and information detailing alleged or
4 actual infractions used to justify a particular suspension that have not
5 previously been shared with the third-party seller or seller profile as
6 set forth in section seventeen hundred six of this article, which may
7 additionally be utilized and considered for the purposes of any subse-
8 quent legal action or dispute resolution process.
9 4. An online marketplace is prohibited from seizing or holding a
10 suspended third-party seller's or seller profile's consumer products
11 that are otherwise unrelated to any and all infractions used to justify
12 a particular suspension.
13 5. A suspended third-party seller or seller profile shall have the
14 right to recall all consumer products from an online marketplace's
15 possession that are listed for sale through such online marketplace that
16 are otherwise unrelated to any and all infractions used to justify a
17 particular suspension.
18 6. An online marketplace is prohibited from holding or seizing funds
19 from suspended third-party sellers or seller profiles that were gener-
20 ated from sales of consumer products unrelated to any and all infrac-
21 tions used to justify a particular suspension.
22 § 1708. Enforcement and penalties. Any third-party seller or seller
23 profile who has been injured by reason of any violation of this article
24 may bring an action in such person's or entity's own name against an
25 online marketplace to enjoin such unlawful act or practice, an action to
26 recover such person's or entity's actual damages or fifty dollars,
27 whichever is greater, or both such actions. The court may, in its
28 discretion, increase the award of damages to an amount not to exceed
29 three times the actual damages if the court finds the defendant willful-
30 ly or knowingly violated this article. The court may award reasonable
31 attorney's fees to a prevailing plaintiff.
32 § 2. This act shall take effect on the ninetieth day after it shall
33 have become a law.
