Privacy Blueprints, Social Media Responsibility, and NAFTA: September 2018 Legislative Update

Congressional Outlook

As noted in our last month’s update Fall agenda will only have 11 working days in September. The House will mostly be in and out of session working on a number of bills, but much of the focus will be on getting members back to their districts this month and most of October to fight for re-election. The Senate will be in session working on appropriations and a budget deal they hope will be signed once it reaches the President’s desk. The confirmation of Supreme Court nominee Brett Kavanaugh continues.

Privacy/Transparency/Data Breach/Encryption

Trump Administration – Privacy Blueprint in the Fall?: The Trump Administration is crafting a proposal to protect Web users’ privacy, aiming to blunt global criticism that the absence of strict federal rules in the US has enabled data mishaps at Facebook and others in Silicon Valley. Over the past month, the Commerce Department has been meeting with officials from tech companies, Internet service providers, and consumer advocates. The government’s goal is to release an initial set of ideas this fall that outlines online users’ rights, including general principles for how companies should collect and handle consumers’ private information. The blueprint could then become the basis for Congress to write the country’s first wide-ranging online-privacy law, an idea that the White House recently indicated it could endorse.

Federal Trade Commission Public Hearings: The FTC will hold a series of public hearings during the fall and winter 2018 examining whether broad-based changes in the economy, evolving business practices, new technologies, or international developments might require adjustments to competition and consumer protection law, enforcement priorities, and policy. The list of dates and topics for the hearings can be found here.

California Privacy Law Discussions: Following a letter from state attorneys generals to the sponsors of California’s privacy law which cited concerns about its constitutionality and ability to adequately protect consumers, Administration officials are meeting with select attorneys general to discuss the law. That includes former Congressman and now California Attorney General Xavier Becerra.

Senator Warner – White Paper and Policy Options for Online Platforms: The 23-page white paper that Senator Warner, as Ranking Member of the Intelligence Committee, released last month that outlines general policy ideas to address online privacy, innovation, and competition, has been gaining some attention in the tech community as they review it. The policies range from comprehensive GDPR-like privacy rules applied to US entities to requiring a platform to provide third-party access on fair, reasonable and non-discriminatory terms.

Intermediary Liability Activity

Senator Manchin, whose state has been hit hard by Opioid addiction, is mulling the idea of introducing legislation to exempt opioid advertising from the safe harbor of Section 230 of CDA. As a member of the Senate Intelligence Committee, he asked the Facebook and Twitter witnesses for their opinion on this approach. They both testified that they agree opioid addiction needs to be addressed, but not by touching Section 230.

Senate Intelligence Hearings on Social Media

On August 1, the Senate Intelligence Committee held a hearing titled Foreign Intelligence Operations and their use of Social Media Platforms: The hearing focused mainly on Russia, which witnesses agreed is continuing its operations to divide and manipulate the electorate. Concerns were raised that technology solutions must also protect free speech and anonymity online. It was noted that when there are instances when the U.S. can identify the servers that are being used, those servers could be taken down. It was clear that Senators are willing to consider regulation and there was some discussion about Section 230 of the CDA.

On September 5, the Committee held its fourth and final, hearing on Foreign Intelligence Operations and their use of Social Media Platforms: Witnesses included Facebook’s COO Sheryl Sandberg and Twitter’s CEO Jack Dorsey. Google declined an invitation to testify. During the hearing, Senator Manchin (D-WV) suggested further narrowing Section 230 of the Communications Decency Act to eliminate liability protections for providers that post online advertising for Opioids. Senator Wyden (D-OR) announced plans to introduce new privacy legislation; and Senator Warner (D-VA) actually praised Facebook and Twitter for already complying with the provisions of his Honest Ads Act, although more needs to be done.

Trade

NAFTA Negotiations: President Trump announced in August that the U.S. and Mexico had reached an agreement on a new United States-Mexico Free Trade Agreement and the White House notified Congress of its “intent to sign a trade agreement with Mexico —and Canada if it is willing — 90 days from now.” That announcement created a flurry of dissent from Congress since Canada was not a party to the agreement and although NAFTA negotiations are underway with Canada, no agreement has been reached. Members of Congress from both sides of the aisle expressed skepticism that they would pass any trade agreement where Canada is excluded (bilateral trade deals need at least 61 votes in the Senate to pass while trilateral deals only need 51). Democrats on the House Ways & Means Committee said U.S. Trade Representative Robert Lighthizer’s Aug. 31 notification to Congress of a new deal with Mexico goes against the spirit of the 2015 Trade Promotion Authority law.

Tariffs on Chinese Products: President Trump has announced that he is considering an additional $267B of tariffs against Chinese goods. Trade groups, including tech groups, have come out against the most recent tariffs ($200B), saying that Section 301 does not authorize them because they are not based on the original 301 investigatory findings as the statute requires. There were concerns about price increases on products that would impact our industry, which is: semiconductors, circuit boards, optical fiber bundles and cables, and electric control panels.