What You Should Know About the SHOP SAFE Act

Legislation designed to curtail counterfeit goods sold online has not passed yet. Could 2026 be the year?

Listen to manufacturers and showrooms talk about the challenges they face in competing with online shopping and you’ll learn there is another growing concern besides IMAP holidays.

There are dozens of lighting manufacturers who regularly discover their product photography next to ridiculously low retail prices on ecommerce sites they do not sell to. This, of course, leads to showrooms feeling betrayed by their vendors (often incorrectly so) and showrooms accused by irate consumers of “price gouging” (also incorrect) because they see “the exact same fixture” online for far less money.

This increasing practice of third-party sellers undercutting prices and substituting inferior product under the guise of legitimate respected brand names affects nearly all categories of retail — which is why there was enough strength in numbers to draft a proposed U.S. law called the SHOP SAFE Act (Stopping Harmful Offers on Platforms by Screening Against Fakes in E-Commerce).

Central to the SHOP SAFE Act is accountability, namely holding ecommerce platforms – from behemoths like Amazon to smaller niche décor sites – responsible for vetting third-party sellers to prevent the sale of unsafe products and establishing liability for those sites that turn a blind eye to counterfeits and unauthorized use of brand names. In the case of lighting, fake UL labels have been discovered on illuminated bathroom mirrors as recently as last year, as well as on portable lamps and fixtures shipped from overseas.

The SHOP SAFE Act proposes the following:

• Platform Liability – e-commerce platforms will be found liable for trademark infringement by third-party sellers if they don’t take reasonable steps to prevent counterfeit sales.

• Seller Vetting – platforms should be required to verify seller identity, contact info, and address.

• Screening – platforms should utilize the latest technology to screen listings and remove counterfeit goods before they are uploaded to the site and seen by consumers.

• Repeat Offender Policy – platforms should institute strict policies to remove and ban repeat counterfeiters.

So far, several iterations of this proposal have been put before Congress – as far back as 2020 and as recently as 2024 – and despite bipartisan support, it has not yet become law. The recent government shutdown in October and November over the unresolved healthcare issue has further relegated all other pending proposals to the back burner.  

The topic of the SHOP SAFE Act came up at the monthly American Lighting Association (ALA) Engineering committee in October, where Palmer Schoening of Schoening Strategies in Washington, D.C., a consultant to ALA’s Government Affairs committee, has had meetings on [Capitol] Hill regarding trade and unfair competition.

“We have a seat at the table again with a lot of important congressional committees and agencies,” he said. “Right now, we’re pushing hard on the issue we are broadly calling ‘unfair competition,’ [regarding] online sellers like Amazon selling noncompliant products with no DOE or UL certification that are flooding the market. We have some great data from Hunter Fan on the emergence of these shady companies selling directly to consumers —  and the trend line is pretty striking in terms of the erosion of market share from ALA members going illegitimately to consumers.”

Schoening stated that ALA manufacturer members have supplied examples of websites that have used their exact product photos and descriptions, but a search for the business addresses of these websites were dead ends, pointing to empty warehouses or college campuses.

Tom Catania, Esq., consultant and counsel to Hunter Fan Company, accompanied Schoening to Capitol Hill to speak with members of Congress about the topic. “We had some great meetings on both the House and the Senate side on this issue. [The SHOP SAFE Act] requires companies like amazon to do more verification of third-party sellers and we’re working on expanding some the language that exceeds the due diligence for those companies,” Schoening said, adding that he had an in-person meeting with the U.S. Department of Labor on that issue, plus others. “We’re really trying to hit this from all angles with Congress and also with the [various] government agencies,” he noted and encouraged manufacturers to keep him apprised of infractions that they see from online sellers that are not playing by the rules.

It was noted during the ALA Engineering committee meeting that the major online retailers have been resistant “every step of the way” to the SHOP SAFE Act proposal which, considering the incredible financial strength of those entities, could keep the proposal stalled for some time.

The last Congressional activity related to the SHOP SAFE Act that LNN could find stated that a version of the SHOP SAFE Act was introduced in the 118th Congress (H.R. 8684) and was referred to the House Judiciary Committee on June 11, 2024, but did not receive a floor vote in either the House or Senate. While bipartisan sponsors have expressed their intention to re-introduce the SHOP SAFE Act, no such action has taken place yet.

To read the opinion of the president of CCIA – an international, not-for-profit trade association representing a cross section of communications and technology firms – as to why he does not believe the SHOP SAFE Act will solve the counterfeit problem, click here.

To read the opinion of law firm Dentons, which differentiates between the INFORM Consumers Act that went into effect in 2023 and the SHOP SAFE Act, click here. It also provides suggestions to manufacturers on what individual states have done to combat the problem.

As always, your opinion matters on topics affecting the lighting industry. If you have an opinion you would like to share, please email linda@homenewsnow.com