Legislation Impacting Retailers
By David Dorf on May 08, 2013
Today, select retailers are accompanying NRF advocates to the hill to discuss key legislation with congress. The Washington Leadership Conference is an opportunity for congress to hear directly from retailers and to better understand the issues they face. The key issues being discussed are:
- Sales Tax Fairness
- Health Care
- Patent Trolls
- Tax Reform
- Loss Prevention and Organized Crime
- Mobile Location Tracking
The headlines have been focused on the recent passing of the Marketplace Fairness Act, which allows states to begin collecting sales tax for online sales regardless of a seller's physical presence. This should help level the playing field for brick-and-mortar retailers vs the pure online retailers, plus it could prove to be a valuable source of revenue for states at a time when the coffers are low.
But for me, the more interesting legislation are those that have to do with technology. Patent Trolls love to go after retailers for mundane things such as assigning unique transaction numbers to sales, using an online shopping cart, or making product recommendations. Usually retailers calculate the cost of litigation and then just decide to license the patent for less, but recently Newegg fought a troll in court...and won. Congress is considering the Saving High-Tech Innovators from Egregious Legal Disputes (Shield) Act, which forces patent trolls to pay for litigation costs when they lose. That might make it easier for retailers to defend themselves.
Another pending issue is that of privacy and the use of mobile phones to track shoppers' location. There's an interesting battle going on between Senator Al Franken and Euclid, a company that provides analytics to retailers based on tracking mobile phones. On the surface, the issue has to do with shoppers opting-in or -out to tracking, as well as full disclosure on who has access to the data. That seems reasonable, but if those steps become too onerous then they detract from the relationship between consumers and retailers. There are huge opportunities for retailers to better serve their customers if the data can be leveraged in a mutually agreeable fashion.