Congress moves to strip Amazon, eBay of power to freeze seller funds without proof

What it does

This bill requires the FTC to establish rules protecting third-party sellers on dominant online marketplaces (like Amazon, eBay) from arbitrary account suspensions, inventory holds, and fund freezes. Sellers would gain the right to 30-day notice before inventory or funds are held, written explanations of policy violations, and the ability to sue platforms directly for damages—including treble damages and attorney fees. The bill shifts the burden of proof to platforms, requiring them to demonstrate wrongdoing rather than sellers having to prove innocence.

Why we flagged it

The bill's operative mechanism is a due-process and transparency mandate on dominant online marketplaces, enforced by the FTC and private right of action. It is fundamentally a consumer/seller protection measure, not a subsidy, carve-out, or deregulation.

What the text implies

• The private right of action with treble damages and attorney fees may incentivize litigation against platforms even for marginal violations, potentially raising compliance costs that could be passed to all sellers or consumers.
• The 30-day inventory-hold and fund-hold limits may force platforms to make faster decisions with less investigation time, potentially increasing false positives (wrongful suspensions of innocent sellers).
• The definition of 'critical trading partner' is broad and functional (any platform that can restrict access), potentially capturing smaller marketplaces or niche platforms not intended as targets.
• State attorneys general parens patriae authority may lead to duplicative enforcement and conflicting state-level interpretations of FTC rules, creating compliance fragmentation.
• The bill does not address whether platforms must maintain seller data or provide evidence in a format sellers can use in private litigation, potentially creating discovery disputes.

Section numbers refer to the bill text the analysis read — linked under Primary records below.

Who it affects

Ordinary people who sell online gain enforceable due-process protections, transparency, and a private right of action against platform overreach. Small sellers—who depend on these platforms for livelihood—are substantially better off. The costs fall on dominant platforms' ability to act unilaterally, which is a legitimate public-interest restraint on private power, not a cost to citizens.

Who stands to gain

• third-party sellers (small and independent businesses)
• plaintiff attorneys (treble damages + attorney fees provision)
• state attorneys general (enforcement authority)

Named in the bill

Federal Trade Commission (FTC), Amazon (AMZN), eBay (EBAY), Best Buy (BBY), State Attorneys General, Third-party sellers, Online marketplaces

Where it stands

9 cosponsors: 9 Democrats.

• Jul 21, 2026 — Introduced · Congress.gov: “Introduced in House”
• Jul 21, 2026 — Referred to House Committee on the Judiciary · Congress.gov: “Referred to the House Committee on the Judiciary”

Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.