[Congressional Record Volume 162, Number 146 (Tuesday, September 27, 2016)]
[Senate]
[Pages S6141-S6142]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. DAINES (for himself, Mr. Nelson, and Ms. Klobuchar):
  S. 3402. A bill to protect consumers from deceptive practices with 
respect to online booking of hotel reservations, and for other 
purposes; to the Committee on Commerce, Science, and Transportation.
  Mr. DAINES. Mr. President, the travel and tourism industry plays a 
significant role in the U.S. economy. Travel and tourism contributed 
over $480 billion to the U.S. GDP last year. In Montana, tourism is one 
of our leading industries. Every year, visitors spend over $3 billion 
in our state which supports jobs and reduces taxes for Montana 
residents.
  The development of the online marketplace has made it easier than 
ever for travelers to do research, plan trips, and make reservations 
online. Online platforms allow customers to compare thousands of brands 
in one place. As a result, the number of hotel reservations made online 
has surged over the past several years. There are now up to 480 
bookings every minute. As the number of online bookings has increased, 
there has also been an increase in the number of online booking scams.
  Illegitimate reservation sellers pose as hotel websites, leading 
consumers to believe they are booking directly with the hotel, when in 
fact they are booking with an unrelated third party. Transactions on 
these sites can result in additional hidden fees, loss of expected 
loyalty points, or even confirmation of reservations that were never 
made. One study found that as many as 15 million bookings a year are 
affected by fraudulent websites.
  That is why I am proud to introduce the Stop Online Booking Scams Act 
of 2016 with my colleague Senator Nelson. The bill requires third party 
sites to disclose that they are not affiliated with the hotel, 
providing clarity and transparency to consumers booking online. It also 
empowers state attorneys general to pursue cases on behalf of consumers 
who have been scammed. Providing clear disclosures that reveal the true 
identity of websites will give confidence to the millions of consumers 
who make reservations online every year. I ask my colleagues to join me 
in cosponsoring this much needed legislation.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 3402

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Stop Online Booking Scams 
     Act of 2016''.

     SEC. 2. FINDINGS; SENSE OF CONGRESS.

       (a) Findings.--Congress finds the following:
       (1) The Internet has become an important channel of 
     commerce in the United States, accounting for billions of 
     dollars in retail sales every year.
       (2) Hotel reservation transactions can be easily made 
     online and online commerce has created a marketplace where 
     consumers can shop for hotels, flights, car rentals, and 
     other travel-related services and products across thousands 
     of brands on a single platform.
       (3) Consumers should have the utmost clarity as to the 
     company with which such consumers are transacting business 
     online.
       (4) Actions by third party sellers that misappropriate 
     brand identity, trademark, or other marketing content are 
     harmful to consumers.
       (5) Platforms offered by online travel agencies provide 
     consumers with a valuable tool for comparative shopping for 
     hotels and should not be mistaken for the unlawful third-
     party actors that commit such misappropriation.
       (6) The misleading and deceptive sales tactics companies 
     use against customers booking hotel rooms online have 
     resulted in the loss of sensitive financial and personal 
     information, financial harm, and headache for consumers.
       (b) Sense of Congress.--It is the sense of Congress that--
       (1) consumers benefit from the ability to shop for travel-
     related services and products on the innovative platforms 
     offered by online travel agencies;
       (2) sellers on the Internet should provide consumers with 
     clear, accurate information and such sellers should have an 
     opportunity to compete fairly with one another; and
       (3) the Federal Trade Commission should revise the Internet 
     website of the Commission to make it easier for consumers and 
     businesses to report complaints of deceptive practices with 
     respect to online booking of hotel reservations.

     SEC. 3. DEFINITIONS.

       In this Act:
       (1) Affiliation contract.--The term ``affiliation 
     contract'' means, with respect to a hotel, a contract with 
     the owner of the hotel, the entity that manages the hotel, or 
     the franchisor of the hotel to provide online hotel 
     reservation services for the hotel.
       (2) Commission.--The term ``Commission'' means the Federal 
     Trade Commission.
       (3) Exhibition organizer or meeting planner.--The term 
     ``exhibition organizer or meeting planner'' means the person 
     responsible for all aspects of planning, promoting, and 
     producing a meeting, conference, event, or exhibition, 
     including overseeing and arranging all hotel reservation 
     plans and contracts for the meeting, conference, event, or 
     exhibition.
       (4) Official housing bureau.--The term ``official housing 
     bureau'' means the organization designated by an exhibition 
     organizer or meeting planner to provide hotel reservation 
     services for meetings, conferences, events, or exhibitions.
       (5) Party directly affiliated.--The term ``party directly 
     affiliated'' means, with respect to a hotel, a person who has 
     entered into an affiliation contract with the hotel.
       (6) Third party online hotel reservation seller.--The term 
     ``third party online hotel reservation seller'' means any 
     person that--
       (A) sells any good or service with respect to a hotel in a 
     transaction effected on the Internet; and
       (B) is not--
       (i) a party directly affiliated with the hotel; or
       (ii) an exhibition organizer or meeting planner or the 
     official housing bureau for a meeting, conference, event, or 
     exhibition held at the hotel.

     SEC. 4. REQUIREMENTS FOR THIRD PARTY ONLINE HOTEL RESERVATION 
                   SELLERS.

       (a) In General.--It shall be unlawful for a third party 
     online hotel reservation seller to charge or attempt to 
     charge any consumer's credit card, debit card, bank account, 
     or other financial account for any good or service sold in a 
     transaction effected on the Internet with respect to a hotel 
     unless the third party online hotel reservation seller--
       (1) clearly and conspicuously discloses to the consumer all 
     material terms of the transaction, including--
       (A) before the conclusion of the transaction--
       (i) a description of the good or service being offered; and
       (ii) the cost of such good or service; and
       (B) in a manner that is continuously visible to the 
     consumer throughout the transaction process, the fact that 
     the person is a third party online hotel reservation seller 
     and is not--
       (i) affiliated with the person who owns the hotel or 
     provides the hotel services or accommodations; or
       (ii) an exhibition organizer or meeting planner or the 
     official housing bureau for a meeting, conference, event, or 
     exhibition held at the hotel; or
       (2) includes prominent and continuous disclosure of the 
     brand identity of the third party online hotel reservation 
     seller throughout the transaction process, both online and 
     over the phone.
       (b) Enforcement by Commission.--
       (1) Unfair or deceptive acts or practices.--A violation of 
     subsection (a) by a person subject to such subsection shall 
     be treated as a violation of a rule defining an unfair or 
     deceptive act or practice prescribed under section 
     18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C. 
     57a(a)(1)(B)).
       (2) Powers of commission.--
       (A) In general.--The Commission shall enforce this section 
     in the same manner, by the same means, and with the same 
     jurisdiction, powers, and duties as though all applicable 
     terms and provisions of the Federal Trade Commission Act (15 
     U.S.C. 41 et seq.) were incorporated into and made a part of 
     this Act.
       (B) Privileges and immunities.--Any person who violates 
     this section shall be subject to the penalties and entitled 
     to the privileges and immunities provided in the Federal 
     Trade Commission Act (15 U.S.C. 41 et seq.).
       (C) Rulemaking.--
       (i) In general.--The Commission may promulgate such rules 
     as the Commission considers appropriate to enforce this 
     section.
       (ii) Procedures.--The Commission shall carry out any 
     rulemaking under clause (i) in accordance with section 553 of 
     title 5, United States Code.
       (c) Enforcement by States.--
       (1) In general.--In any case in which the attorney general 
     of a State has reason to believe that an interest of the 
     residents of the State has been or is threatened or adversely 
     affected by the engagement of any person subject to 
     subsection (a) in a practice that

[[Page S6142]]

     violates such subsection, the attorney general of the State 
     may, as parens patriae, bring a civil action on behalf of the 
     residents of the State in an appropriate district court of 
     the United States to obtain appropriate relief.
       (2) Rights of federal trade commission.--
       (A) Notice to federal trade commission.--
       (i) In general.--Except as provided in clause (iii), the 
     attorney general of a State shall notify the Commission in 
     writing that the attorney general intends to bring a civil 
     action under paragraph (1) before initiating the civil action 
     against a person subject to subsection (a).
       (ii) Contents.--The notification required by clause (i) 
     with respect to a civil action shall include a copy of the 
     complaint to be filed to initiate the civil action.
       (iii) Exception.--If it is not feasible for the attorney 
     general of a State to provide the notification required by 
     clause (i) before initiating a civil action under paragraph 
     (1), the attorney general shall notify the Commission 
     immediately upon instituting the civil action.
       (B) Intervention by federal trade commission.--The 
     Commission may--
       (i) intervene in any civil action brought by the attorney 
     general of a State under paragraph (1) against a person 
     described in subsection (d)(1); and
       (ii) upon intervening--

       (I) be heard on all matters arising in the civil action; 
     and
       (II) file petitions for appeal of a decision in the civil 
     action.

       (3) Investigatory powers.--Nothing in this subsection may 
     be construed to prevent the attorney general of a State from 
     exercising the powers conferred on the attorney general by 
     the laws of the State to conduct investigations, to 
     administer oaths or affirmations, or to compel the attendance 
     of witnesses or the production of documentary or other 
     evidence.
       (4) State coordination with federal trade commission.--If 
     the Commission institutes a civil action or an administrative 
     action with respect to a violation of subsection (a), the 
     attorney general of a State shall coordinate with the 
     Commission before bringing a civil action under paragraph (1) 
     against any defendant named in the complaint of the 
     Commission for the violation with respect to which the 
     Commission instituted such action.
       (5) Venue; service of process.--
       (A) Venue.--Any action brought under paragraph (1) may be 
     brought in--
       (i) the district court of the United States that meets 
     applicable requirements relating to venue under section 1391 
     of title 28, United States Code; or
       (ii) another court of competent jurisdiction.
       (B) Service of process.--In an action brought under 
     paragraph (1), process may be served in any district in which 
     the defendant--
       (i) is an inhabitant; or
       (ii) may be found.
       (6) Actions by other state officials.--
       (A) In general.--In addition to civil actions brought by 
     attorneys general under paragraph (1), any other officer of a 
     State who is authorized by the State to do so may bring a 
     civil action under paragraph (1), subject to the same 
     requirements and limitations that apply under this subsection 
     to civil actions brought by attorneys general.
       (B) Savings provision.--Nothing in this subsection may be 
     construed to prohibit an authorized official of a State from 
     initiating or continuing any proceeding in a court of the 
     State for a violation of any civil or criminal law of the 
     State.
                                 ______