[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4568 Introduced in House (IH)]

<DOC>






118th CONGRESS
  1st Session
                                H. R. 4568

  To require covered entities to issue a short-form terms of service 
               summary statement, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 11, 2023

 Mrs. Trahan introduced the following bill; which was referred to the 
                    Committee on Energy and Commerce

_______________________________________________________________________

                                 A BILL


 
  To require covered entities to issue a short-form terms of service 
               summary statement, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Terms-of-service Labeling, Design, 
and Readability Act'' or the ``TLDR Act''.

SEC. 2. STANDARD TERMS OF SERVICE SUMMARY STATEMENT.

    (a) Deadline for Terms of Service Summary Statement.--Not later 
than 360 days after the date of the enactment of this Act, the 
Commission shall issue a rule under section 553 of title 5, United 
States Code, with regard to a covered entity that publishes or has 
published a terms of service--
            (1) that requires the covered entity to include a truthful 
        and non-misleading short-form terms of service summary 
        statement on the website of the entity;
            (2) that requires the covered entity to include a truthful 
        and non-misleading graphic data flow diagram on the website of 
        the entity; and
            (3) that requires the covered entity to display the full 
        terms of service of the entity in an interactive data format.
    (b) No New Contractual Obligation.--The requirement to include a 
summary statement described in subsection (a) does not create any new 
contractual obligation.
    (c) Requirements for Short-Form Terms of Service Summary 
Statement.--
            (1) In general.--The short-form terms of service summary 
        statement described in subsection (a)--
                    (A) shall be accessible to individuals with low 
                levels of literacy and individuals with disabilities, 
                machine readable, and shall include tables, graphic 
                icons, hyperlinks, or other means as the Commission may 
                require; and
                    (B) may be presented differently depending on the 
                interface or type of device on which the statement is 
                being accessed by the user.
            (2) Location of summary statement and graphic data flow 
        diagram.--The summary statement shall be placed at the top of 
        the permanent terms of service page of the covered entity and 
        any graphic data flow diagram shall be located immediately 
        below the statement.
            (3) Contents of summary statement.--The summary statement 
        shall include the following:
                    (A) The categories of sensitive information that 
                the covered entity processes.
                    (B) The sensitive information that is required for 
                the basic functioning of the service and what sensitive 
                information is needed for additional features and 
                future feature development.
                    (C) A summary of the legal liabilities of a user 
                and any rights transferred from the user to the covered 
                entity, such as mandatory arbitration, class action 
                waiver, any licensing or sale by the covered entity of 
                the content of the user, and any waiver of moral 
                rights.
                    (D) Historical versions of the terms of service and 
                change logs.
                    (E) If the covered entity provides user deletion 
                services, directions for how the user can delete 
                sensitive information or discontinue the use of 
                sensitive information.
                    (F) A list of data breaches from the previous 3 
                years reported to consumers under existing Federal and 
                State laws.
                    (G) The effort required by a user to read the 
                entire terms of service text, such as through the total 
                word count and approximate time to read the statement.
                    (H) Any other information the Commission determines 
                to be necessary if that information is included in the 
                terms of service by the covered entity.
            (4) Additional information required by the commission.--The 
        Commission shall include in the rule a list of other 
        information the Commission determines to be necessary under 
        paragraph (3)(H).
    (d) Guidance on Graphic Data Flow Diagrams.--Not later than 360 
days after the date of the enactment of this Act, the Commission shall 
publish guidelines on how a covered entity can graphically display how 
sensitive information of a user is shared with a subsidiary or 
corporate affiliate of such entity and how sensitive information is 
shared with third parties.
    (e) Interactive Data Format Terms of Service.--Not later than 360 
days after the date of the enactment of this Act, the Commission shall 
issue a rule under section 553 of title 5, United States Code, that 
requires a covered entity to tag portions of the terms of services of 
the entity according to an interactive data format.
    (f) Enforcement.--
            (1) Unfair or deceptive acts or practices.--A violation of 
        this section or a regulation promulgated under this section 
        shall be treated as a violation of a regulation under section 
        18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C. 
        57a(a)(1)(B)) regarding unfair or deceptive acts or practices.
            (2) Powers of the commission.--The Commission shall enforce 
        this section and the regulations promulgated under this section 
        in the same manner, by the same means, and with the same 
        jurisdiction, powers, and duties as though all applicable terms 
        and provisions of the Federal Trade Commission Act (15 U.S.C. 
        41 et seq.) were incorporated into and made a part of this 
        section, and any person who violates this section or a 
        regulation promulgated under this section shall be subject to 
        the penalties and entitled to the privileges and immunities 
        provided in the Federal Trade Commission Act.
            (3) Enforcement by state attorneys general.--In any case in 
        which the attorney general of a State has reason to believe 
        that an interest of at least 1,000 residents of that State has 
        been or is threatened or adversely affected by the engagement 
        of any person in a practice that violates this section or a 
        regulation promulgated under this section, the State, as parens 
        patriae, may bring a civil action on behalf of the residents of 
        the State in a district court of the United States of 
        appropriate jurisdiction to--
                    (A) enjoin that practice;
                    (B) enforce compliance with the regulation;
                    (C) obtain damage, restitution, or other 
                compensation on behalf of residents of the State; or
                    (D) obtain such other relief as the court may 
                consider to be appropriate.
            (4) Notice.--
                    (A) In general.--Before filing an action under 
                paragraph (3), the attorney general of the State 
                involved shall provide to the Commission--
                            (i) written notice of that action; and
                            (ii) a copy of the complaint for that 
                        action.
                    (B) Exemption.--
                            (i) In general.--Subparagraph (A) shall not 
                        apply with respect to the filing of an action 
                        by an attorney general of a State under this 
                        subsection, if the attorney general determines 
                        that it is not feasible to provide the notice 
                        described in that subparagraph before the 
                        filing of the action.
                            (ii) Notification.--In an action described 
                        in clause (i), the attorney general of a State 
                        shall provide notice and a copy of the 
                        complaint to the Commission at the same time as 
                        the attorney general files the action.
            (5) Intervention by the commission.--
                    (A) Authority to intervene.--The Commission may 
                intervene in any action brought under paragraph (3).
                    (B) Effect of intervention.--If the Commission 
                intervenes in an action under paragraph (3), the 
                Commission shall have the right--
                            (i) to be heard with respect to any matter 
                        that arises in that action; and
                            (ii) to file a petition for appeal.
            (6) Construction.--For purposes of bringing any civil 
        action under paragraph (3), nothing in this section may be 
        construed to prevent an attorney general of a State from 
        exercising the powers conferred on the attorney general by the 
        laws of that State to--
                    (A) conduct investigations;
                    (B) administer oaths or affirmations; or
                    (C) compel the attendance of witnesses or the 
                production of documentary and other evidence.
            (7) Actions by the commission.--In any case in which an 
        action is instituted by or on behalf of the Commission for a 
        violation of this section or a regulation promulgated under 
        this section, a State may not, during the pendency of that 
        action, institute a separate action under paragraph (3) against 
        any defendant named in the complaint in the action instituted 
        by or on behalf of the Commission for that violation.
    (g) Rule of Construction.--Nothing in this section shall be 
construed to limit the authority of the Commission under any other 
provision of law.
    (h) Definitions.--In this section:
            (1) Commission.--The term ``Commission'' means the Federal 
        Trade Commission.
            (2) Covered entity.--The term ``covered entity''--
                    (A) means any person or entity that operates a 
                website located on the internet or an online service, 
                that is operated for commercial purposes; and
                    (B) does not include a small business concern (as 
                defined in section 3 of the Small Business Act (15 
                U.S.C. 632)).
            (3) Disability.--The term ``disability'' has the meaning 
        given the term in section 3 of the Americans with Disabilities 
        Act of 1990 (42 U.S.C. 12102).
            (4) Interactive data format.--The term ``interactive data 
        format'' means an electronic data format in which pieces of 
        information are identified using an interactive data standard, 
        such as eXtensible Markup Language (XML), that is a 
        standardized list of electronic tags that mark the information 
        described in subsection (c)(3) within the terms of service of a 
        covered entity.
            (5) Moral rights.--The term ``moral rights'' means the 
        rights conferred by section 106A(a) of title 17, United States 
        Code.
            (6) Process.--The term ``process'' means any operation or 
        set of operations performed on sensitive information, including 
        collection, analysis, organization, structuring, retaining, 
        using, or otherwise handling sensitive information.
            (7) Sensitive information.--The term ``sensitive 
        information'' means any of the following:
                    (A) Health information.
                    (B) Biometric information.
                    (C) Precise geolocation information.
                    (D) Social security number.
                    (E) Information concerning the race, color, 
                religion, national origin, sex, age, or disability of 
                an individual.
                    (F) The content and parties to a communication.
                    (G) Audio and video recordings captured through a 
                consumer device.
                    (H) Financial information, including a bank account 
                number, credit card number, debit card number, or 
                insurance policy number.
                    (I) Online browsing history, which means 
                information revealing online activities over time or 
                across websites or online services not owned or 
                operated by the covered entity.
            (8) State.--The term ``State'' means each of the several 
        States, the District of Columbia, each commonwealth, territory, 
        or possession of the United States, and each federally 
        recognized Indian Tribe.
            (9) Third party.--The term ``third party'' means, with 
        respect to a covered entity, a person--
                    (A) to which the covered entity disclosed sensitive 
                information; and
                    (B) that is not--
                            (i) the covered entity;
                            (ii) a subsidiary or corporate affiliate of 
                        the covered entity; or
                            (iii) a service provider of the covered 
                        entity.
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