Lobby Against Ad-Targeting Rules Takes on Bill to Speed FTC Work
A coalition of Internet and other communications companies is opposing, through a procedural back door, FTC efforts to go after behavioral targeting of ads. The group, NetChoice, said Thursday that topping its periodic list of the worst legislative proposals in the country concerning the Internet is a bill to free the commission from special restrictions on its rulemaking work under the Magnuson-Moss act of 1975 and put it, like other federal agencies, under the Administrative Procedure Act.
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
NetChoice opposes the provisions in the federal bill -- HR-4173, a broad overhaul of financial regulation -- because it would allow the FTC to act in 12-18 months to impose rules requiring consumer opt-in to all online-information tracking for behavioral targeting ads, rather than the years that would take under current procedures, Executive Director Steve DelBianco told reporters on a conference call about the list, branded iAWFUL -- “our shovel to dig the Internet out from under a blizzard of bad legislation.” The group includes eBay, IAC, News Corp., Time Warner, VeriSign, Yahoo, the Electronic Retailing Association and the Internet Alliance, which counts as members AT&T, Comcast and the Direct Marketing Association.
“I'm guilty of conflating” the question of FTC procedures with the targeting issue, DelBianco acknowledged. “But I don’t really think I'm stretching” in making the connection. The current restrictions include valuable “speed bumps” such as substantial advance notice of rulemakings and an opportunity for companies to challenge regulations in court before they take effect, he said. When it’s important for the commission to act fast, “Congress makes it happen,” as it did by putting fast-tracking provisions in laws such as the CAN-SPAM Act and the Children’s Online Privacy Protection Act, DelBianco said.
Business often accuses government of falling behind the pace of technology, but “when we say the FTC can’t keep up, we're mostly talking about enforcement,” DelBianco said, not adding regulations. The Administrative Procedure Act is more suitable to agencies whose powers don’t extend as widely as the FTC’s, he said. The commission didn’t get back to us right away Thursday.
The measures are “all pain and no gain” for states, DelBianco said. Virginia’s Senate passed one, SB-660, Monday, 28-12, DelBianco said, but Wednesday the House Finance Committee chairman called it dead in the water and Gov. Bob McDonnell said he doesn’t favor it. Similar proposals are in the Colorado, Illinois, Maryland, New Mexico and Vermont legislatures, NetChoice said.
The bills reflect a trend toward “aggressive and in some cases even desperate” state legislative efforts “to extract more tax revenue” from online business in response to budget gaps, DelBianco said. All the rest of the top six targets on the NetChoice list meet this description, too, he said. No. 3 is a model bill by the Multistate Tax Commission to impose hotel taxes on service fees charged by online sites as travel agents.