[Congressional Record Volume 168, Number 198 (Tuesday, December 20, 2022)]
[Senate]
[Pages S9636-S9639]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
SA 6567. Ms. KLOBUCHAR (for herself and Mr. Grassley) submitted an
amendment intended to be proposed to amendment SA 6552 proposed by Mr.
Leahy to the bill H.R. 2617, to amend section 1115 of title 31, United
States Code, to amend the description of how performance goals are
achieved, and for other purposes; which was ordered to lie on the
table; as follows:
At the appropriate place, insert the following:
[[Page S9637]]
DIVISION__--AMERICAN INNOVATION AND CHOICE ONLINE
SEC. 101. SHORT TITLE.
This division may be cited as the ``American Innovation and
Choice Online Act''.
SEC. 102. DEFINITIONS.
(a) In General.--In this division:
(1) Antitrust laws; person.--The terms ``antitrust laws''
and ``person'' have the meanings given the terms in
subsection (a) of the first section of the Clayton Act (15
U.S.C. 12).
(2) Business user.--The term ``business user''--
(A) means a person that uses or is likely to use a covered
platform for the advertising, sale, or provision of products
or services, including such persons that are operating a
covered platform or are controlled by a covered platform
operator; and
(B) does not include a person that--
(i) is a clear national security risk; or
(ii) is controlled by the Government of the People's
Republic of China or the government of a foreign adversary.
(3) Commission.--The term ``Commission'' means the Federal
Trade Commission.
(4) Control.--The term ``control'' means, with respect to a
person--
(A) holding 25 percent or more of the stock of the person;
(B) having the right to 25 percent or more of the profits
of the person;
(C) in the event of the dissolution of the person, having
the right to 25 percent or more of the assets of the person;
(D) if the person is a corporation, having the power to
designate 25 percent or more of the directors of the person;
(E) if the person is a trust, having the power to designate
25 percent or more of the trustees; or
(F) otherwise exercising substantial control over the
person.
(5) Covered platform.--The term ``covered platform'' means
an online platform that--
(A) has been designated as a covered platform under section
103(d);
(B) is owned or controlled by a person that--
(i) at any point during the 12 months preceding a
designation under section 103(d) or the 12 months preceding
the filing of a complaint for an alleged violation of this
division has at least--
(I) 50,000,000 United States-based monthly active users on
the online platform; or
(II) 100,000 United States-based monthly active business
users on the online platform;
(ii) during--
(I) the 2 years preceding a designation under section
103(d), or the 2 years preceding the filing of a complaint
for an alleged violation of this division--
(aa) at any point, is owned or controlled by a person with
United States net annual sales of greater than
$550,000,000,000, adjusted for inflation on the basis of the
Consumer Price Index; or
(bb) during any 180-day period during the 2-year period,
has an average market capitalization greater than
$550,000,000,000, adjusted for inflation on the basis of the
Consumer Price Index; or
(II) the 12 months preceding a designation under section
103(d), or at any point during the 12 months preceding the
filing of a complaint for an alleged violation of this
division, has at least 1,000,000,000 worldwide monthly active
users on the online platform; and
(iii) is a critical trading partner for the sale or
provision of any product or service offered on or directly
related to the online platform.
(6) Critical trading partner.--The term ``critical trading
partner'' means a person that has the ability to restrict or
materially impede the access of--
(A) a business user to the users or customers of the
business user; or
(B) a business user to a tool or service that the business
user needs to effectively serve the users or customers of the
business user.
(7) Data.--The term ``data'' includes information that is
collected by or provided to a covered platform or business
user that is linked, or reasonably linkable, to a specific--
(A) user or customer of the covered platform; or
(B) user or customer of a business user.
(8) Foreign adversary.--The term ``foreign adversary'' has
the meaning given the term in section 8(c) of the Secure and
Trusted Communications Networks Act of 2019 (47 U.S.C.
1607(c)).
(9) Online platform.--The term ``online platform''--
(A) means a website, online or mobile application,
operating system, digital assistant, or online service that
enables--
(i) a user to generate or share content that can be viewed
by other users on the platform or to interact with other
content on the platform;
(ii) the offering, advertising, sale, purchase, or shipping
of products or services, including software applications,
between and among consumers or businesses not controlled by
the platform operator; or
(iii) user searches or queries that access or display a
volume of information; and
(B) does not include a service by wire or radio that
provides the capability to transmit data to and receive data
from all or substantially all internet endpoints, including
any capabilities that are incidental to and enable the
operation of the communications service.
(10) State.--The term ``State'' means a State, the District
of Columbia, the Commonwealth of Puerto Rico, and any other
territory or possession of the United States.
(b) Regulations.--Not later than 180 days after the date of
enactment of this division, the Commission, with the
concurrence of the Department of Justice, shall promulgate
regulations in accordance with section 553 of title 5, United
States Code, to define the term data for the purpose of
implementing and enforcing this division.
SEC. 103. UNLAWFUL CONDUCT.
(a) In General.--It shall be unlawful for a person
operating a covered platform in or affecting commerce to--
(1) preference the products, services, or lines of business
of the covered platform operator over those of another
business user on the covered platform in a manner that would
materially harm competition;
(2) limit the ability of the products, services, or lines
of business of another business user to compete on the
covered platform relative to the products, services, or lines
of business of the covered platform operator in a manner that
would materially harm competition;
(3) discriminate in the application or enforcement of the
terms of service of the covered platform among similarly
situated business users in a manner that would materially
harm competition;
(4) materially restrict, impede, or unreasonably delay the
capacity of a business user to access or interoperate with
the same platform, operating system, or hardware or software
features that are available to the products, services, or
lines of business of the covered platform operator that
compete or would compete with products or services offered by
business users on the covered platform, except where such
access would lead to a significant cybersecurity risk;
(5) condition access to the covered platform or preferred
status or placement on the covered platform on the purchase
or use of other products or services offered by the covered
platform operator that are not part of or intrinsic to the
covered platform;
(6) use nonpublic data that are obtained from or generated
on the covered platform by the activities of a business user
or by the interaction of a covered platform user with the
products or services of a business user to offer, or support
the offering of, the products or services of the covered
platform operator that compete or would compete with products
or services offered by business users on the covered
platform;
(7) materially restrict or impede a business user from
accessing data generated on the covered platform by the
activities of the business user, or through an interaction of
a covered platform user with the products or services of the
business user, such as by establishing contractual or
technical restrictions that prevent the portability by the
business user to other systems or applications of the data of
the business user;
(8) materially restrict or impede covered platform users
from uninstalling software applications that have been
preinstalled on the covered platform or changing default
settings that direct or steer covered platform users to
products or services offered by the covered platform
operator, unless necessary--
(A) for the security or functioning of the covered
platform; or
(B) to prevent data from the covered platform operator or
another business user from being transferred to the
Government of the People's Republic of China or the
government of a foreign adversary;
(9) in connection with any covered platform user interface,
including search or ranking functionality offered by the
covered platform, treat the products, services, or lines of
business of the covered platform operator more favorably
relative to those of another business user and in a manner
that is inconsistent with the neutral, fair, and
nondiscriminatory treatment of all business users; or
(10) retaliate against any business user or covered
platform user that raises good-faith concerns with any law
enforcement authority about actual or potential violations of
State or Federal law on the covered platform or by the
covered platform operator.
(b) Affirmative Defenses.--
(1) In general.--It shall be an affirmative defense to an
action under subsection (a) if the defendant establishes that
the conduct was reasonably tailored and reasonably necessary,
such that the conduct could not be achieved through
materially less discriminatory means, to--
(A) prevent a violation of, or comply with, Federal or
State law;
(B) protect safety, user privacy, the security of nonpublic
data, or the security of the covered platform; or
(C) maintain or substantially enhance the core
functionality of the covered platform.
(2) Additional affirmative defenses.--It shall be an
affirmative defense to an action under paragraph (4), (5),
(6), (7), (8), (9), or (10) of subsection (a) if the
defendant establishes that the conduct has not resulted in
and would not result in material harm to competition.
(3) Effect of other laws.--Notwithstanding any other
provision of law, whether user conduct would constitute a
violation of section 1030 of title 18, United States Code,
shall have no effect on whether the defendant has established
an affirmative defense under this division.
(4) Burden of proof.--The defendant has the burden of
proving an affirmative defense under this subsection by a
preponderance of the evidence.
[[Page S9638]]
(c) Enforcement.--
(1) In general.--Except as otherwise provided in this
division--
(A) the Commission shall enforce this division in the same
manner, by the same means, and with the same jurisdiction,
powers, and duties as though all applicable terms of the
Federal Trade Commission Act (15 U.S.C. 41 et seq.) were
incorporated into and made a part of this division;
(B) the Department of Justice shall enforce this division
in the same manner, by the same means, and with the same
jurisdiction, powers, and duties as though all applicable
terms of the Sherman Act (15 U.S.C. 1 et seq.), Clayton Act
(15 U.S.C. 12 et seq.), and Antitrust Civil Process Act (15
U.S.C. 1311 et seq.) were incorporated into and made a part
of this division; and
(C) any attorney general of a State shall enforce this
division in the same manner, by the same means, and with the
same jurisdiction, powers, and duties as though all
applicable terms of the Sherman Act (15 U.S.C. 1 et seq.) and
the Clayton Act (15 U.S.C. 12 et seq.) were incorporated into
and made a part of this division.
(2) Commission independent litigation authority.--If the
Commission has reason to believe that a person violated this
division, the Commission may commence a civil action, in its
own name by any of its attorneys designated by it for such
purpose, to recover a civil penalty and seek other
appropriate relief in a district court of the United States.
(3) Parens patriae.--Any attorney general of a State may
bring a civil action in the name of such State for a
violation of this division as parens patriae on behalf of
natural persons residing in such State, in any district court
of the United States having jurisdiction of the defendant for
any form of relief provided for in this section.
(4) Enforcement in federal district court.--The Commission,
Department of Justice, or any attorney general of a State
shall only be able to enforce this division through a civil
action brought before a district court of the United States.
(5) Preponderance of the evidence.--The Department of
Justice, the Commission, or the attorney general of a State
shall establish a violation of this section by a
preponderance of the evidence.
(6) Remedies.--
(A) In general.--The remedies provided in this paragraph
are in addition to, and not in lieu of, any other remedy
available under Federal or State law.
(B) Civil penalty.--Any person who violates this division
shall forfeit and pay to the United States a civil penalty in
an amount that is sufficient to deter violations of this
division, but not greater than 10 percent of the total United
States revenue of the person for the period of time the
violation occurred.
(C) Injunctions.--
(i) In general.--The Department of Justice, the Commission,
or the attorney general of any State may seek, and the court
may order, relief in equity as necessary to prevent,
restrain, or prohibit violations of this division.
(ii) Temporary injunctions.--
(I) In general.--The Commission, Department of Justice, or
any attorney general of a State may seek a temporary
injunction requiring the covered platform operator to take or
stop taking any action for not more than 120 days.
(II) Grant.--The court may grant a temporary injunction
under this clause if the Commission, the Department of
Justice, or the attorney general of a State, as applicable,
demonstrates--
(aa) there is a plausible claim, supported by substantial
evidence raising sufficiently serious questions going to the
merits to make them fair ground for litigation, that a
covered platform operator violated this division;
(bb) that the conduct alleged to violate this division
materially impairs the ability of business users to compete
with the covered platform operator; and
(cc) a temporary injunction would be in the public
interest.
(III) Duration.--A temporary injunction under this clause
shall expire not later than the date that is 120 days after
the date on which a complaint under this subsection is filed.
(IV) Termination.--The court shall terminate a temporary
injunction under this clause if the covered platform operator
demonstrates that--
(aa) the Commission, the Department of Justice, or the
attorney general of the State seeking relief under this
subsection has not taken reasonable steps to investigate
whether a violation has occurred; or
(bb) allowing the temporary injunction to continue would
harm the public interest.
(V) Other equitable relief.--Nothing in this clause shall
prevent or limit the Commission, the Department of Justice,
or any attorney general of any State from seeking other
equitable relief, including the relief provided in this
paragraph.
(D) Forfeiture for repeat offenders.--
(i) In general.--If a person has engaged in a pattern or
practice of violating this division, the court shall consider
requiring, and may order, that the chief executive officer of
the person, and any other corporate officer of the person as
appropriate to deter violations of this division, forfeit to
the United States Treasury any compensation received by that
chief executive officer or corporate officer during the 12
months preceding the filing of a complaint for an alleged
violation of this division.
(ii) Forfeiture process.--Prior to ordering any chief
executive officer or corporate officer to forfeit
compensation under subsection (I), the court shall provide
such chief executive officer or corporate officer with
reasonable notice that the court is considering ordering
forfeiture under this section and provide an opportunity for
such chief executive officer or corporate officer to appear
and be heard before the court at a hearing on such potential
forfeiture.
(7) Statute of limitations.--A proceeding for a violation
of this section may be commenced not later than 6 years after
such violation occurs.
(8) Rules of construction.--
(A) In general.--Nothing in subsection (a) may be
construed--
(i) to require a covered platform operator to divulge or
license any intellectual property, including any trade
secrets, business secrets, or other confidential proprietary
business processes, owned by or licensed to the covered
platform operator;
(ii) to prevent a covered platform operator from asserting
its preexisting rights under intellectual property law to
prevent the unauthorized use of any intellectual property
owned by or duly licensed to the covered platform operator;
(iii) to require a covered platform operator to
interoperate or share data with persons or business users
that are on any list maintained by the Federal Government by
which entities--
(I) are identified as limited or prohibited from engaging
in economic transactions as part of United States sanctions
or export-control regimes; or
(II) have been identified as national security,
intelligence, or law enforcement risks;
(iv) to prohibit a covered platform operator from promptly
requesting and obtaining the consent of a covered platform
user prior to providing access to the nonpublic, personally
identifiable information of the user to a covered platform
user under that subsection;
(v) in a manner that would likely result in data on the
covered platform or data from another business user being
transferred to the Government of the People's Republic of
China or the government of a foreign adversary; or
(vi) to impose liability on a covered platform operator
solely for offering--
(I) full end-to-end encrypted messaging or full end-to-end
encrypted communication products or services; or
(II) a fee-for-service subscription that provides benefits
to covered platform users on the covered platform.
(B) Copyright and trademark violations.--An action taken by
a covered platform operator that is reasonably tailored to
protect the rights of third parties under section 106, 1101,
1201, or 1401 of title 17, United States Code, or rights
actionable under section 32 or 43 of the Act entitled ``An
Act to provide for the registration and protection of
trademarks used in commerce, to carry out the provisions of
certain international conventions, and for other purposes'',
approved July 5, 1946 (commonly known as the ``Lanham Act''
or the ``Trademark Act of 1946'') (15 U.S.C. 1114, 1125), or
corollary State law, shall not be considered unlawful conduct
under subsection (a).
(d) Covered Platform Designation.--
(1) In general.--The Commission and the Department of
Justice may jointly, with concurrence of the other, designate
an online platform as a covered platform for the purpose of
implementing and enforcing this division, which shall--
(A) be based on a finding that the criteria set forth in
section 102(a)(5)(B) are met;
(B) be issued in writing and published in the Federal
Register; and
(C) except as provided in paragraph (2), apply for a 7-year
period beginning on the date on which the designation is
issued, regardless of whether there is a change in control or
ownership over the covered platform.
(2) Removal of covered platform designation.--The
Commission or the Department of Justice shall--
(A) consider whether a designation of a covered platform
under paragraph (1) should be removed prior to the expiration
of the 7-year period if the covered platform operator files a
request with the Commission or the Department of Justice that
shows that the online platform no longer meets the criteria
set forth in section 102(a)(5)(B);
(B) determine whether to grant a request submitted under
subparagraph (A) not later than 120 days after the date on
which the request is filed;
(C) obtain the concurrence of the Commission or the
Department of Justice, as appropriate, before granting a
request submitted under subparagraph (A); and
(D) publish any decision to grant or deny removal of a
covered platform designation in the Federal Register.
(3) Judicial review.--Any person operating an online
platform that has been designated as a covered platform under
paragraph (1) or whose request for removal of such a
designation under paragraph (2) is denied may, within 30 days
of the issuance of such designation or decision, petition for
review of such designation or decision in the United States
Court of Appeals for the District of Columbia Circuit.
SEC. 104. ENFORCEMENT GUIDELINES.
(a) In General.--Not later than 270 days after the date of
enactment of this Act, the Commission and the Department of
Justice, in consultation with other relevant Federal
[[Page S9639]]
agencies and State attorneys general, shall jointly issue
agency enforcement guidelines outlining policies and
practices relating to conduct that may materially harm
competition under section 103(a), agency interpretations of
the affirmative defenses under section 103(b), and policies
for determining the appropriate amount of a civil penalty to
be sought under section 103(c), with the goal of promoting
transparency, deterring violations, fostering innovation and
procompetitive conduct, and imposing sanctions proportionate
to the gravity of individual violations.
(b) Updates.--The Commission and the Department of Justice
shall update the joint guidelines issued under subsection (a)
as needed to reflect current agency policies and practices,
but not less frequently than once every 4 years beginning on
the date of enactment of this Act.
(c) Public Notice and Comment.--Before issuing guidelines,
or updates to those guidelines, under this section, the
Commission and the Department of Justice shall--
(1) publish proposed guidelines in draft form; and
(2) provide public notice and opportunity for comment for
not less than 60 days after the date on which the draft
guidelines are published.
(d) Operation.--The joint guidelines issued under this
section do not--
(1) confer any rights upon any person, State, or locality;
and
(2) operate to bind the Commission, Department of Justice,
or any person, State, or locality to the approach recommended
in the guidelines.
SEC. 105. RULE OF CONSTRUCTION.
Nothing in this division may be construed to limit--
(1) any authority of the Department of Justice or the
Commission under the antitrust laws, section 5 of the Federal
Trade Commission Act (15 U.S.C. 45), or any other provision
of law; or
(2) the application of any law.
SEC. 106. SEVERABILITY.
If any provision of this division, or the application of
such provision to any person or circumstance, is held to be
unconstitutional, the remainder of this division, and the
application of the remaining provisions of this division, to
any person or circumstance, shall not be affected.
SEC. 107. EFFECTIVE DATE.
(a) In General.--Except as provided in subsection (b), this
division shall take effect on the date of enactment of this
Act.
(b) Exception.--Section 103(a) shall take effect on the
date that is 1 year after the date of enactment of this Act.
(c) Authority.--The exception in subsection (b) shall not
limit the authority of the Commission or Department of
Justice to implement other sections of this division.
______