The Colorado General Assembly is evaluating a bill that would make it a criminal offense to sell common consumer goods such as cosmetics, value-loaded “gift” cards, non-prescription drugs and baby food via an internet auction. The “company line” is that this will help address the sale of stolen goods online, but we believe it’s really a bill to prevent online auctions from competing with traditional retailers.
Online auction sites would be required to interrogate people about how they acquired an item they want to list for sale…or be subject to criminal penalties. This is preposterous and would earn Colorado the distinction of having the harshest anti-Internet commerce bill in the country.
It’s clearly an attempt to limit competition from online auctions since newspaper classifieds and other “off-line” sales are not affected, nor are non-auction Internet listings.
Blaming online marketplaces for organized retail crime ignores the root cause of the retail theft problem. The National Retail Federation conducted its own study of the problem in 2005, and found that:
• Most retail theft occurs from a store’s own employees and retail vendors. Shoplifting accounted for less than one-third.
• Retailers have pursued fewer prosecutions, arrests, and invoked civil recovery laws less frequently in 2005 compared to previous years.
• Retail theft is not increasing. The rate has generally declined over the years, and is 12% lower that it was just 4 years earlier.
If enacted into law, this would impose extraordinary and discriminatory restrictions on Internet marketplaces and the thousands of Colorado consumers that use them every day.