Kerry and McCain Bill Signals Privacy Law Momentum

  |  April 12, 2011   |  Comments

The bipartisan Commercial Privacy Bill of Rights would give the FTC enforcement power over data privacy requirements.

johnkerry-privacyhearingU.S. Senators John Kerry, a Democrat, and John McCain, a Republican, introduced their bipartisan privacy bill today. "The Commercial Privacy Bill of Rights Act of 2011" addresses both online and offline data privacy.

The bill calls for the Federal Trade Commission to establish rules requiring companies collecting personally identifiable data to provide "clear, concise, and timely notice" of data collection, use and transfer. Personally identifiable data includes information such as names and email addresses. If passed, the law would grant the FTC oversight of a requirement that companies offer "a clear and conspicuous mechanism for opt-out consent for any unauthorized use of their personally identifiable information."

In particular, the legislation would have the FTC develop rules requiring that companies offer consumers "a robust, clear, and conspicuous" opt-out mechanism from use of their personally-identifiable data by third parties "for behavioral advertising or marketing." An earlier draft of the bill did not make specific mention of data collection and use for online advertising.

The Kerry/McCain bill would be the first comprehensive data privacy protection bill introduced in the Senate recently. Coupled with related bills introduced in the U.S. House, the new bill signals increasing momentum behind privacy legislations affecting online advertisers.

Unlike another bill introduced in the House recently by Democrat Jackie Speier, the Kerry/McCain bill does not refer specifically to do-not-track, a concept popularized by the FTC. "The commercial privacy bill of rights will keep our private data safe by laying down fair information practices for anyone collecting it," stated Kerry during a press conference announcing the bill.

A provision in the bill gives the FTC power to establish a safe harbor program and to approve of and monitor non-governmental initiatives - such as an industry self-regulatory program - for providing consumers a "clear, conspicuous, persistent, and effective" opt-out from data transfer for behavioral ads or "location-based advertising." The bill also gives the FTC the ability to impose civil penalties on groups running such programs if they are found to be noncompliant.

Whether the online ad industry's self-regulatory program, implemented under the Digital Advertising Alliance umbrella, would satisfy those FTC requirements is not clear.

The Direct Marketing Association is a key member of that alliance, and requires its members to abide by the alliance’s privacy guidelines. In a press release today, the DMA stated its "concern that legislation would impose untold regulatory compliance costs on businesses without a showing that there is a market failure or a need to regulate." The group went on to say it "does not believe that the case has been made that consumers have been harmed."

"Senator McCain and I have introduced this legislation with sensitivity to the economy," stated Kerry.

The Kerry/McCain bill, like a related House bill sponsored by Democrat Bobby Rush, allows the FTC to slap penalties on violators. It also prohibits private right of action, and calls for the Department of Commerce to work with industry and other groups in developing codes of conduct for safe harbor application.

"I will do my part to foster further discussions and considerations of both bills among all interested parties and stakeholders," stated Rep. Rush in a statement supporting the Kerry/McCain bill. "I'll continue to work diligently to ensure the passage of legislation that is based on a sound understanding of the relevant offline and online ecosystems at work, today, but that can bend to evolutionary developments and still meet consumers needs without breaking."

ClickZ Live New York Want to learn more?
Attend ClickZ Live New York March 30 - April 1. With over 15 years' experience delivering industry-leading events, ClickZ Live brings together over 60 expert speakers to offer an action-packed, educationally-focused agenda covering all aspects of digital marketing. Register today!


Kate Kaye

Kate Kaye was Managing Editor at ClickZ News until October 2012. As a daily reporter and editor for the original news source, she covered beats including digital political campaigns and government regulation of the online ad industry. Kate is the author of Campaign '08: A Turning Point for Digital Media, the only book focused on the paid digital media efforts of the 2008 presidential campaigns. Kate created ClickZ's Politics & Advocacy section, and is the primary contributor to the one-of-a-kind section. She began reporting on the interactive ad industry in 1999 and has spoken at several events and in interviews for television, radio, print, and digital media outlets. You can follow Kate on Twitter at @LowbrowKate.

COMMENTSCommenting policy

comments powered by Disqus

Get the ClickZ Marketing newsletter delivered to you. Subscribe today!




Featured White Papers

A Buyer's Guide to Affiliate Management Software

A Buyer's Guide to Affiliate Management Software
Manage your performance marketing with the right solution. Choose a platform that will mutually empower advertisers and media partners!

Google My Business Listings Demystified

Google My Business Listings Demystified
To help brands control how they appear online, Google has developed a new offering: Google My Business Locations. This whitepaper helps marketers understand how to use this powerful new tool.


    • Website Optimizer - SEO, CRO, Analytics
      Website Optimizer - SEO, CRO, Analytics (Marcel Digital) - ChicagoMarcel Digital, an award winning interactive marketing agency established in 2003...
    • Director of Marketing
      Director of Marketing (Patron Technology) - New YorkDirector of Marketing We are seeking a Director of Marketing to manage and build our marketing...
    • Senior Interactive Producer
      Senior Interactive Producer (Ready Set Rocket) - New YorkWhat You'll Do As a member of our team, the Senior Producer reports directly to our...