It will soon be illegal to punish customers who criticize businesses online

Congress has passed a law protecting the right of US consumers to post negative online reviews without fear of retaliation from companies.

The bipartisan Consumer Review Fairness Act was passed by unanimous consent in the US Senate yesterday, a Senate Commerce Committee announcement said. The bill, introduced in 2014, was already approved by the House of Representatives and now awaits President Obama's signature.

The Commerce Committee held a hearing on gag clauses a year ago and said it heard "testimony from Ms. Jen Palmer, a plaintiff in Palmer v. KlearGear, where a company demanded the removal of a negative online review or payment of $3,500 in fines because the online merchant’s terms of service included a non-disparagement clause. When the review was not taken down, the company reported the unpaid $3,500 to a credit reporting agency as an outstanding debt, which negatively impacted the Palmers’ credit."

Palmer beat Kleargear in court, but only after a years-long ordeal. In other cases, a supplements maker, called Ubervita, threatened legal action against customers leaving negative reviews on Amazon, and a jewelry store sued a customer who left a one-star review on Yelp.

The Consumer Review Fairness Act—full text available here—voids any provision in a form contract that prohibits or restricts customers from posting reviews about the goods, services, or conduct of the company providing the product or service. It also voids provisions that impose penalties or fees on customers for posting online reviews as well as those that require customers to give up the intellectual property rights related to such reviews. The legislation empowers the Federal Trade Commission to enforce the new law and impose penalties when necessary.

The bill also protects reviews that aren't available via the Internet.

Senate Republicans and Democrats praised the bill's passage. "By ending gag clauses, this legislation supports consumer rights and the integrity of critical feedback about products and services sold online," Commerce Committee Chairman John Thune (R-S.D.) said in the announcement.

"Reviews on where to shop, eat, or stay on websites like Yelp or TripAdvisor help consumers make informed choices about where to spend their money," said Sen. Brian Schatz (D-Hawaii). "Every consumer has the right to share their honest experiences and opinions of any business without the fear of legal retaliation, and the passage of our bill brings us one step closer to protecting that right."