EU electronic communications privacy rules would be extended to over-the-top players, machine-to-machine and IoT communications under a controversial European Commission proposal. The proposed ePrivacy Regulation (ePR) to replace the current law (Directive 2002/58/EC) is needed because of increasing consumer and business reliance on newer internet-based communications services such as VoIP, instant messaging and web-based email, which aren't subject to current rules, the EC said. The draft raised concerns during a Wednesday debate in the European Parliament Civil Liberties, Justice and Home Affairs (LIBE) Committee. It got industry criticism.
Notable CROSS rulings
A California legislator unveiled an ISP privacy bill rebuking President Donald Trump’s repeal of the FCC broadband privacy rules. The bill by Assembly Privacy Committee Chairman Ed Chau (D) would require ISPs to get opt-in consent from consumers to use, disclose, sell or permit access to customer personal information, Chau’s office said. AB-375 -- to be amended Tuesday with the privacy language -- also would require clear and conspicuous consent disclosures, would ban providers from “pay-for-privacy” arrangements or penalizing customers for not consenting, and would require ISPs to protect customer information through reasonable security measures. It doesn’t set up a private right to action, but the state attorney general could enforce the bill. “Congress and the Administration went against the will of the vast majority of Americans when they revoked the FCC’s own privacy rules in April, but California is going to restore what Washington stripped away,” Chau said in a Monday news release. The bill could be heard by a committee in mid-July, a spokesman said on a news-media call Monday. Consumer and privacy advocates including the American Civil Liberties Union and the Electronic Frontier Foundation supported the proposal. It's the latest of many states considering ISP privacy legislation to fill the void left by the Congressional Review Act repeal of privacy rules, though bills so far have struggled to cross the finish line (see 1705300052). Two in five states have bills responding to the federal repeal, said a National Conference of State Legislatures report updated Monday. On Monday’s journalist call, EFF Legal Counsel Ernesto Falcon predicted more progress across the states in months. “This is state number 20,” he said. “I wouldn’t be surprised to get to state number 50 by the beginning of next year.” Passing a law in California could have “huge impact,” and EFF is bracing for “ferocious” opposition from telecom and cable lobbyists because ISPs fear that “if they lose any one state, they’re going to lose every state,” Falcon said. “When a large state like California takes the lead … voters in other parts of the country grow envious.” Falcon doesn’t believe federal pre-emption of the state bills is likely due to separations rules and a history of failed FCC attempts to pre-empt states, he said.
Communications groups backed updating the North American Free Trade Agreement and made recommendations to the Office of U.S. Trade Representative in comments posted in docket USTR-2017-0006 this week. The Telecommunications Industry Association proposed new provisions on "free cross-border transfers of data," "Mexico's timely accession to the Information Technology Agreement, to which the U.S. and Canada already belong," "fair competition with state-owned enterprises," agency transparency and notice-and-comment requirements, and a prohibition on foreign telecom ownership limits, including for spectrum licenses. TIA backed keeping and enforcing provisions on "open, non-discriminatory and reciprocal market access in government procurement" and various standards issues, including "mutual recognition of standards and certification bodies for telecom equipment." The Computing Technology Industry Association said U.S. tech companies benefited under NAFTA from "tariff reductions, strong intellectual property rights, licensing rules, patent protections, and preferential rules of origin," and it urged prioritizing World Trade Organization Information Technology Agreement adherence, import/export license procedures, government procurement, digital trade and e-commerce, and several customs and trade-facilitation objectives. The Internet Infrastructure Coalition focused on encryption, national security exceptions, certification requirements, intellectual property and digital trade, including data flows, localization, regulatory transparency and intermediary liability. Engine said business startups would benefit if key protections under U.S. law are added to NAFTA, such as "the protection of cross-border data flows, intermediary liability protections and copyright safe harbors."
Congressional Republicans still want to pull together and move legislation to overhaul FCC process, although movement on Capitol Hill may not be imminent, lawmakers told us, given lack of Senate action in 2017. FCC reauthorization is seen as one legislative vehicle that could include tweaks to FCC process this Congress. FCC Chairman Ajit Pai has urged Capitol Hill to revise the Sunshine Act to allow commissioners to talk more easily to one another (see 1705310042), attracting bicameral and bipartisan support among lawmakers despite transparency advocate concerns. Commissioners Mike O’Rielly and Mignon Clyburn back the proposal.
Rural telco groups and CenturyLink urged FCC caution in revising separations rules for how costs are allocated between the federal and state jurisdictions. ITTA said the FCC should eliminate the separations regime for price-cap carriers. Comments were posted Wednesday and Thursday in docket 80-286. The FCC recently extended a freeze on jurisdictional separations rules for 18 months while a federal-state joint board attempts to develop new proposals (see 1705150064).
Restrictions on pricing, on selling in online marketplaces, and geographic restrictions on selling and advertising online were some of the top concerns in the final e-commerce report released Wednesday by the European Commission's Directorate-General for Competition. Two years ago, the commission began looking into e-commerce of consumer goods and digital content across the EU as part of its digital single market strategy. The EC published a preliminary report in September and then sought comment, which was incorporated into a final one. It said pricing restrictions and recommendations are "the most widespread restrictions" reported by retailers. It said both manufacturers and retailers frequently track online retail prices through pricing software, which could enable manufacturers to detect deviations from pricing recommendations and retaliate against retailers or it could facilitate collusion among retailers. The report said restrictions limiting retailers' ability to sell via online marketplaces has raised concerns under EU competition rules. The report said 90 percent of retailers use their own online shop when selling, with 31 percent selling via their online shops and marketplaces and 4 percent selling only via marketplaces. The study said market restrictions play a bigger role in some member states than in others, and might "range from absolute bans to restrictions on selling on marketplaces that do not fulfil certain quality criteria." The Computer & Communications Industry Association said in a news release it's concerned about the outright bans. "These restrictions are particularly detrimental for small and medium-sized sellers. They also harm competition and consumer choice,” said Jakob Kucharczyk, director-CCIA Europe. "Turning a blind eye on these restrictions will mean that thousands of sellers will not be able to benefit from the latest technological wave. This in itself merits rigorous enforcement action against blanket marketplace bans.” The EC report also said geo-blocking measures are used by some retailers, with some raising competition concerns.
The newspaper/broadcast cross-ownership rule is “no longer necessary to promote the public interest, and should be abolished,” said News Corp. Global Head-Government Affairs Antoinette Cook Bush in a meeting with FCC Chairman Ajit Pai Tuesday, according to an ex parte filing posted Thursday in docket 14-50. “The rule is outdated and fails to reflect the dramatic increase in news services available online and on cable.” Pai should eliminate the rule “in the context of the pending reconsideration proceeding rather than as part of any future Quadrenniel [sic] Review” to create certainty for the newspaper industry, the filing said.
LAS VEGAS -- Media ownership rule relaxation, or at least a hard look at existing rules, is likely under this FCC, said speakers on a panel at the NAB Show, including Commissioner Mike O'Rielly. He and others cited the so-called eight-voices test, which limits common ownership of TV stations within markets with fewer than that number of outlets. Panelists also cited rules against one company publishing a daily newspaper and owning a broadcaster in the same market.
Net neutrality is expected to be the major focus at the FCC’s May meeting, industry officials said. FCC Chairman Ajit Pai has had a busy agenda so far, but several former FCC officials said Tuesday they're not hearing of much else teed up for that meeting. Pai is to speak at the Newseum Wednesday on the future of Internet regulation, where he's likely to sketch out his plans for a net neutrality NPRM (see 1704240049). Pai is to circulate draft items by Thursday for the May 18 meeting. One other item on tap for the meeting is a proposed “comprehensive review” of FCC media regulations (see 1704250065).
The FTC approved separate final orders with Sentinel Labs, SpyChatter and Vir2us, which settled allegations in February that they falsely participated in the Asia-Pacific Economic Cooperation (APEC) voluntary data-transfer system (see 1702220040), the commission said in a Friday news release. Commissioners voted 2-0 to approve the three orders, which bar the companies "from misrepresenting their participation, membership or certification in any privacy or security program sponsored by a government or self-regulatory or standard-setting organization." The FTC alleged the companies falsely said in their online privacy policies that they participated in the APEC Cross-Border Privacy Rules system when they didn't. The commission also alleged Sentinel Labs "falsely" claimed participation in TRUSTe's privacy program.