[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.
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