From the Digital to the Physical: Federal Limitations on Regulating Online Marketplaces

58 Pages Posted: 22 Jan 2018 Last revised: 9 Jun 2019

See all articles by Benjamin G. Edelman

Benjamin G. Edelman

Harvard University - HBS Negotiations, Organizations and Markets Unit

Abbey Stemler

Indiana University - Kelley School of Business - Department of Business Law

Date Written: January 31, 2018

Abstract

Online marketplaces have transformed how we shop, travel, and interact with the world. Yet, their unique innovations also present a panoply of challenges for communities and states. Surprisingly, federal laws are chief among those challenges despite the fact that online marketplaces facilitate transactions traditionally regulated at the local level. In this Article, we survey the federal laws that frame the situation, especially §230 of the Communications Decency Act (CDA), a 1996 law largely meant to protect online platforms from defamation lawsuits. The CDA has been stretched beyond recognition to prevent all manner of prudent regulation. We offer specific suggestions to correct this misinterpretation to assure that state and local governments can appropriately respond to the digital activities which impact physical realities.

Keywords: Marketplaces, Peer To Peer, Sharing Economy, Decentralized, Regulation, Preemption, Markets, Internet, Government Legislation, Laws and Statutes, United States, Innovation, Communications Decency Act, platform

Suggested Citation

Edelman, Benjamin G. and Stemler, Abbey, From the Digital to the Physical: Federal Limitations on Regulating Online Marketplaces (January 31, 2018). 56 Harv. J. on Legis. 141 (2019); Harvard Business School NOM Unit Working Paper No. 18-063; Kelley School of Business Research Paper No. 18-11. Available at SSRN: https://ssrn.com/abstract=3106383 or http://dx.doi.org/10.2139/ssrn.3106383

Benjamin G. Edelman (Contact Author)

Harvard University - HBS Negotiations, Organizations and Markets Unit ( email )

Soldiers Field
Boston, MA 02163
United States

HOME PAGE: http://people.hbs.edu/bedelman

Abbey Stemler

Indiana University - Kelley School of Business - Department of Business Law ( email )

Bloomington, IN 47405
United States

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