Free-market groups support CRFA
We take this position for one simple reason: when conducting business on the Internet, firms must maintain good reputations to stay competitive. Without this channel for accountability and transparency, public confidence in online commerce itself would be undermined.
The Internet is a critical nexus for commerce, providing a quarter-billion Americans with access to new markets and enhanced economic opportunities. Of central importance to these online markets is their ability to conduct reliable transactions with a full range of commercial firms and entrepreneurial individuals.
Thanks to online reviews and feedback, consumers can feel secure doing business with those whom they’ve never met to make a purchase, get a ride, arrange a place to stay or conduct myriad other transactions. Potential customers also have access to far better, richer information about restaurants, hotels and local service providers than ever before. Online reviews are an essential channel for reputational feedback; they provide online firms and entrepreneurs with the greatest incentives to maximize benefits to customers.
Unfortunately, bad actors sometimes use abusive lawsuits to silence their critics and weaken their competitors. This undermines everyone’s ability to engage in an open, transparent and free market.
The Consumer Review Freedom Act addresses this issue by targeting non-disparagement clauses, which sometimes are buried within firms’ terms of service or other non-negotiable agreements and which restrict consumers’ ability to review their experiences fairly and honestly.
These agreements represent unfair contracts of adhesion and threaten to strangle the vast economic benefits of online reviews. Furthermore, they restrict freedom of speech and undermine the promise and spirit of the First Amendment. We urge you to support this package of reforms to help create a strong national standard for the protection of both free expression and free markets.
Mike Godwin, R Street Institute
Mytheos Holt, Institute for Liberty
Steve Pociask, American Consumer Institute