Remote Transactions Parity Act – HUGE Small Business Exemption Change – Much Worse than MFA!

To recap, the Remote Transactions Parity Act (RTPA) is the Marketplace Fairness Act (MFA) 1.1.  Same fundamental flawed and broken structure.  But now I think the RTPA is actually much worse than the MFA.

The RTPA has a Small Business Exemption (SBE), as does the MFA.  But new verbiage introduced since a March draft I saw completely destroys the SBE for a TON of businesses.

Inexplicably, the new paragraph states that you are treated the same as a business that exceeds $10 million in sales and can’t be exempt from the law if your company “utilizes an electronic marketplace for the purpose of making products or services available for sale to the public”.

This is INSANE!

So some small company who also happens to list some products on Ebay,  Amazon or Etsy now no longer qualifies for any small business exemption, no matter how small they are and will be required to bear the full regulatory burden of the RTPA 180 days after passage.  Just because they list through a marketplace.  And really, what does that newly added definition even mean in the real world?  Yes, it’s defined, but it’s a bit vague.

This is a TERRIBLE last minute addition to the bill that will dramatically affect the number of affected retailers, enrich CSPs and wipe out some smaller retailers.  I can’t believe that this hugely impactful section wasn’t in the March bill draft and has now been added as almost an afterthought.

 

” (3) ELECTRONIC MARKETPLACE.—The term ‘‘electronic marketplace’’ means a digital marketing
platform where—(A) products or services are offered for
sale by more than 1 remote seller; and (B) buyers may purchase such products or
services through a common system of financial transaction processing.”

 

In the end, RTPA will get rid of the Small Business Exemption after 3 years, leaving a huge windfall for the CSPs to touch literally every business in America.

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