FTC Puts Market Participants ‘on Notice’ in New Strategic Plan

The FTC’s various rulemaking efforts are designed to put “market participants on notice,” and the commission is committed to activating all legal authorities necessary for enforcement, Chair Lina Khan said in a statement with Commissioners Rebecca Kelly Slaughter and Alvaro Bedoya in support of the agency’s five-year strategic plan, issued Friday.

The commission voted 3-1-1 to publish the strategic plan for fiscal years 2022-26, with Commissioner Christine Wilson dissenting and Commissioner Noah Phillips not participating. The majority’s plan “exceeds our authority & expertise, and will distract us from the work @FTC was established to accomplish,” Wilson tweeted. The majority’s vision for the agency includes goals outside the FTC’s “statutory remit,” she said in a statement. “Prior attempts by the Commission to address myriad societal ills not included in our Congressional mandate invited strong censure from Congress,” she said, citing restrictions placed on agency rulemaking proceedings in 1980.

The FTC took its first official steps toward issuing a rulemaking on privacy earlier this month, and Republicans accused the majority of a power grab (see 2208110068). Khan is also pursuing various competition rules (see 2206270057). “Congress tasked the FTC with a critical mission, and we are committed to effectively deploying our authorities and resources to deliver,” Khan said in her statement with Democrats.

Wilson earlier this week cited a lack of “concrete action” on the agency review of the Children's Online Privacy Protection Act rule after a more than three-year review. She pointed to her statement earlier this month in which she criticized the majority for issuing a commission policy statement that “recycles” staff guidance instead of issuing revisions to the rule after a lengthy review. The FTC declined comment about COPPA.

Stakeholders are gearing up for potential legislative action on children’s privacy legislation next month when Congress returns. Sens. Richard Blumenthal, D-Conn., and Marsha Blackburn, R-Tenn., are pushing for a floor vote on their Kids Online Safety Act (KOSA) (S-3663), which the Senate Commerce Committee passed unanimously along with a voice vote for the Children and Teens’ Online Privacy Protection Act (COPPA 2.0) (S-1628) from Sen. Ed Markey, D-Mass.

A niche approach to privacy that carves out specific types of data practices isn’t the right approach, said Information Technology and Innovation Foundation Senior Policy Analyst Ashley Johnson in an interview Friday: Congress should focus on passing a comprehensive data privacy law like the American Data Privacy and Protection Act (see 2208250040) or another law that would give “privacy rights to everyone.” The ADPPA needs improvement and compromise before it's ready for the floor, but ITIF is “generally supportive of it,” she said.

A better approach would be something similar to the bipartisan bill Senate Judiciary Committee ranking member Chuck Grassley, R-Iowa, introduced with Sen. Jon Ossoff, D-Ga., NetChoice said in a statement Friday. S-4719, the Preventing Child Sex Abuse Act, seeks to strengthen a sex tourism law that prosecutors believe would be too vague to convict former USA Gymnastics team doctor Larry Nassar. It specifically targets predators who coerce children into sexual activity online through messaging and other platform communication. When S-3663 was introduced, NetChoice called it “overbroad and in need of significant revision.”

KOSA and COPPA 2.0 have the support to move, said National Center on Sexual Exploitation Vice President-Public Policy Eleanor Kennelly Gaetan. She noted a third of the Senate expressed support for KOSA, including 28 at the Senate Commerce Committee markup in addition to the bill’s co-sponsors not on the committee. “It’s got a serious chance,” she said, noting “a ton of work” will occur in November and December during the lame-duck session: “A lot of legislation happens” after the election.

“I was shocked” by the unanimous committee passage and “excited about the prospects of this bill moving forward in the Senate,” said Warren Binford, University of Colorado Law School and School of Medicine professor of pediatrics-child abuse and neglect. She credited the bill’s provisions giving parents more involvement in decisions about how child user data is collected and giving children more control over their data when they reach adult age.

KOSA is important because it holds tech platforms accountable for harmful online activity through a duty of care, said Gaetan. KOSA calls for a duty of care to act in the best interest of minors and would require platforms to prevent, mitigate and reduce youth exposure to harms from online products, said Family Online Safety Institute Policy Manager Andrew Zack: “Safety by design is a tide that raises all ships, making products safer for everyone, not just minors.” Some issues remain, he said, “including consistency in definitions, age ranges, and transparency requirements with other online safety and privacy laws in states and other countries, as well as more clarity around age assurance requirements.”