    [House Report 108-635]
    [From the U.S. Government Publishing Office]

    108th Congress                                            Rept. 108-635
                            HOUSE OF REPRESENTATIVES
     2d Session                                                      Part 2

    ======================================================================

                 INTERNATIONAL CONSUMER PROTECTION ACT OF 2004

                                    _______

                   November 16, 2004.--Ordered to be printed

                                    _______

     Mr. Sensenbrenner, from the Committee on the Judiciary, submitted the
                                   following

                                  R E P O R T

                            [To accompany H.R. 3143]

          [Including cost estimate of the Congressional Budget Office]

      The Committee on the Judiciary, to whom was referred the bill
    (H.R. 3143) to enhance Federal Trade Commission enforcement
    against cross-border fraud and deception, having considered the
    same, reports favorably thereon with an amendment and
    recommends that the bill as amended do pass.

                                    CONTENTS

                                                                       Page
    The Amendment....................................................     1
    Purpose and Summary..............................................     8
    Background and Need for the Legislation..........................     9
    Hearings.........................................................    10
    Committee Consideration..........................................    11
    Vote of the Committee............................................    11
    Committee Oversight Findings.....................................    11
    New Budget Authority and Tax Expenditures........................    11
    Congressional Budget Office Cost Estimate........................    11
    Performance Goals and Objectives.................................    13
    Constitutional Authority Statement...............................    13
    Section-by-Section Analysis and Discussion.......................    13
    Agency Views.....................................................    17
    Changes in Existing Law Made by the Bill, as Reported............    19
    Committee Jurisdiction Letter....................................    31
    Markup Transcript................................................    34

                                 The Amendment

      The amendment is as follows:
      Strike all after the enacting clause and insert the
    following:

    SECTION 1. SHORT TITLE.

        This Act may be referred to as the ``International Consumer
    Protection Act of 2004''.

    SEC. 2. FOREIGN LAW ENFORCEMENT AGENCY DEFINED.

        Section 4 of the Federal Trade Commission Act (15 U.S.C. 44) is
    amended by adding at the end the following:
        `` `Foreign law enforcement agency' means--
                ``(A) any agency or judicial authority of a foreign
            government, including a foreign state, a political subdivision
            of a foreign state, or a multinational organization constituted
            by and comprised of foreign states, that is vested with law
            enforcement or investigative authority in civil, criminal, or
            administrative matters; and
                ``(B) any multinational or multiagency organization to the
            extent that it is acting on behalf of an entity described in
            subparagraph (A).''.

    SEC. 3. AVAILABILITY OF REMEDIES.

        Section 5(a) of the Federal Trade Commission Act (15 U.S.C. 45(a))
    is amended by adding at the end the following:
        ``(4) (A) For purposes of this subsection, the term `unfair or
    deceptive acts or practices' shall include such acts or practices
    involving foreign commerce that--
                ``(i) cause or are likely to cause reasonably foreseeable
            injury within the United States; or
                ``(ii) involve material conduct occurring within the United
            States.
        ``(B) All remedies available to the Commission with respect to
    unfair and deceptive acts or practices shall be available for acts and
    practices described in this paragraph, including restitution to
    domestic or foreign victims.''.

    SEC. 4. POWERS OF THE COMMISSION.

        (a) Publication of Information; Reports.--Section 6(f) of the
    Federal Trade Commission Act (15 U.S.C. 46(f)) is amended--
                (1) by inserting ``(1)'' after ``such information'' the
            first place it appears; and
                (2) by striking ``purposes.'' and inserting ``purposes, and
            (2) to any officer or employee of any foreign law enforcement
            agency under the same circumstances that making material
            available to foreign law enforcement agencies is permitted
            under section 21(b).''.
        (b) Other Powers of the Commission.--Section 6 of the Federal Trade
    Commission Act (15 U.S.C. 46) is further amended by inserting after
    subsection (i) and before the proviso the following:
        ``(j) Investigative Assistance for Foreign Law Enforcement
    Agencies.--
                ``(1) In general.--Upon a written request from a foreign
            law enforcement agency to provide assistance in accordance with
            this subsection, if the requesting agency states that it is
            investigating, or engaging in enforcement proceedings against,
            possible violations of laws prohibiting fraudulent or deceptive
            commercial practices, or other practices substantially similar
            to practices prohibited by any provision of the laws
            administered by the Commission, other than Federal antitrust
            laws (as defined in section 12(5) of the International
            Antitrust Enforcement Assistance Act of 1994 (15 U.S.C.
            6211(5))), the Commission may provide the assistance described
            in paragraph (2) without requiring that the conduct identified
            in the request constitute a violation of the laws of the United
            States.
                ``(2) Type of assistance.--In providing assistance to a
            foreign law enforcement agency under this subsection, the
            Commission may--
                        ``(A) conduct such investigation as the Commission
                    deems necessary to collect information and evidence
                    pertinent to the request for assistance, using all
                    investigative powers authorized by this Act; and
                        ``(B) when the request is from an agency acting to
                    investigate or pursue the enforcement of civil laws, or
                    when the Attorney General refers a request to the
                    Commission from an agency acting to investigate or
                    pursue the enforcement of criminal laws, seek and
                    accept appointment by a United States district court of
                    Commission attorneys to provide assistance to foreign
                    and international tribunals and to litigants before
                    such tribunals on behalf of a foreign law enforcement
                    agency pursuant to section 1782 of title 28, United
                    States Code.
                ``(3) Criteria for determination.--In deciding whether to
            provide such assistance, the Commission shall consider all
            relevant factors, including--
                        ``(A) whether the requesting agency has agreed to
                    provide or will provide reciprocal assistance to the
                    Commission;
                        ``(B) whether compliance with the request would
                    prejudice the public interest of the United States; and
                        ``(C) whether the requesting agency's investigation
                    or enforcement proceeding concerns acts or practices
                    that cause or are likely to cause injury to a
                    significant number of persons.
                ``(4) International agreements.--If a foreign law
            enforcement agency has set forth a legal basis for requiring
            execution of an international agreement as a condition for
            reciprocal assistance, or as a condition for provision of
            materials or information to the Commission, the Commission,
            with prior approval and ongoing oversight of the Secretary of
            State, and with final approval of the agreement by the
            Secretary of State, may negotiate and conclude an international
            agreement, in the name of either the United States or the
            Commission, for the purpose of obtaining such assistance,
            materials, or information. The Commission may undertake in such
            an international agreement to--
                        ``(A) provide assistance using the powers set forth
                    in this subsection;
                        ``(B) disclose materials and information in
                    accordance with subsection (f) and section 21(b); and
                        ``(C) engage in further cooperation, and protect
                    materials and information received from disclosure, as
                    authorized by this Act.
                ``(5) Additional authority.--The authority provided by this
            subsection is in addition to, and not in lieu of, any other
            authority vested in the Commission or any other officer of the
            United States.
                ``(6) Limitation.--The authority granted by this subsection
            shall not authorize the Commission to take any action or
            exercise any power with respect to a bank, a savings and loan
            institution described in section 18(f)(3) (15 U.S.C.
            57a(f)(3)), a Federal credit union described in section
            18(f)(4) (15 U.S.C. 57a(f)(4)), or a common carrier subject to
            the Act to regulate commerce, except in accordance with the
            proviso following the last designated subsection of section 6
            (15 U.S.C. 46).
                ``(7) Assistance to certain countries.--The Commission may
            not provide investigative assistance under this subsection to a
            foreign law enforcement agency from a foreign state that the
            Secretary of State has determined, in accordance with section
            6(j) of the Export Administration Act of 1979 (50 U.S.C. App.
            2405(j)), has repeatedly provided support for acts of
            international terrorism, unless and until such determination is
            rescinded pursuant to section 6(j)(4) of that Act (50 U.S.C.
            App. 2405(j)(4)).
        ``(k) Referral of Evidence for Criminal Proceedings.--
                ``(1) In general.--Whenever the Commission obtains evidence
            that any person, partnership, or corporation, either domestic
            or foreign, has engaged in conduct that may constitute a
            violation of Federal criminal law, the Commission may transmit
            such evidence to the Attorney General, who may institute
            criminal proceedings under appropriate statutes. Nothing in
            this paragraph affects any other authority of the Commission to
            disclose information.
                ``(2) International information.--The Commission shall
            endeavor to ensure, with respect to memoranda of understanding
            and international agreements it may conclude, that material it
            has obtained from foreign law enforcement agencies acting to
            investigate or pursue the enforcement of foreign criminal laws
            may be used for the purpose of investigation, prosecution, or
            prevention of violations of United States criminal laws.
        ``(l) Expenditures for Cooperative Arrangements.--The Commission
    may expend appropriated funds for--
                ``(1) operating expenses and other costs of bilateral and
            multilateral cooperative law enforcement groups conducting
            activities of interest to the Commission and in which the
            Commission participates; and
                ``(2) expenses for consultations and meetings hosted by the
            Commission with foreign government agency officials, members of
            their delegations, appropriate representatives and staff to
            exchange views concerning developments relating to the
            Commission's mission, development and implementation of
            cooperation agreements, and provision of technical assistance
            for the development of foreign consumer protection or
            competition regimes, such expenses to include necessary
            administrative and logistic expenses and the expenses of
            Commission staff and foreign invitees in attendance at such
            consultations and meetings including--
                        ``(A) such incidental expenses as meals taken in
                    the course of such attendance;
                        ``(B) any travel and transportation to or from such
                    meetings; and
                        ``(C) any other related lodging or subsistence.''.
        (c) Authorization of Appropriations.--The Federal Trade Commission
    is authorized to expend appropriated funds not to exceed $100,000 per
    fiscal year for purposes of section 6(l) of the Federal Trade
    Commission Act (15 U.S.C. 46(l)) (as added by subsection (b) of this
    Act), including operating expenses and other costs of the following
    bilateral and multilateral cooperative law enforcement agencies and
    organizations:
                (1) The International Consumer Protection and Enforcement
            Network.
                (2) The International Competition Network.
                (3) The Mexico-U.S.-Canada Health Fraud Task Force.
                (4) Project Emptor.
                (5) The Toronto Strategic Partnership and other regional
            partnerships with a nexus in a Canadian province.
        (d) Conforming Amendment.--Section 6 of the Federal Trade
    Commission Act (15 U.S.C. 46) is amended by striking ``clauses (a) and
    (b)'' in the proviso following subsection (l) (as added by subsection
    (b) of this section) and inserting ``subsections (a), (b), and (j)''.

    SEC. 5. REPRESENTATION IN FOREIGN LITIGATION.

        Section 16 of the Federal Trade Commission Act (15 U.S.C. 56) is
    amended by adding at the end the following:
        ``(c) Foreign Litigation.--
                ``(1) Commission attorneys.--With the concurrence of the
            Attorney General, the Commission may designate Commission
            attorneys to assist the Attorney General in connection with
            litigation in foreign courts on particular matters in which the
            Commission has an interest.
                ``(2) Reimbursement for foreign counsel.--The Commission is
            authorized to expend appropriated funds, upon agreement with
            the Attorney General, to reimburse the Attorney General for the
            retention of foreign counsel for litigation in foreign courts,
            and for expenses related to litigation in foreign courts in
            which the Commission has an interest.
                ``(3) Limitation on use of funds.--Nothing in this
            subsection authorizes the payment of claims or judgments from
            any source other than the permanent and indefinite
            appropriation authorized by section 1304 of title 31, United
            States Code.
                ``(4) Other authority.--The authority provided by this
            subsection is in addition to any other authority of the
            Commission or the Attorney General.''.

    SEC. 6. SHARING INFORMATION WITH FOREIGN LAW ENFORCEMENT AGENCIES.

        (a) Material Obtained Pursuant to Compulsory Process.--Section
    21(b)(6) of the Federal Trade Commission Act (15 U.S.C. 57b-2(b)(6)) is
    amended by adding at the end the following: ``The custodian may make
    such material available to any foreign law enforcement agency upon the
    prior certification of an appropriate official of any such foreign law
    enforcement agency, either by a prior agreement or memorandum of
    understanding with the Commission or by other written certification,
    that such material will be maintained in confidence and will be used
    only for official law enforcement purposes, if--
                ``(A) the foreign law enforcement agency has set forth a
            bona fide legal basis for its authority to maintain the
            material in confidence;
                ``(B) the materials are to be used for purposes of
            investigating, or engaging in enforcement proceedings related
            to, possible violations of--
                        ``(i) foreign laws prohibiting fraudulent or
                    deceptive commercial practices or other practices
                    substantially similar to practices prohibited by any
                    law administered by the Commission;
                        ``(ii) a law administered by the Commission, if
                    disclosure of the material would further a Commission
                    investigation or enforcement proceeding; or
                        ``(iii) with the approval of the Attorney General,
                    other foreign criminal laws, if such foreign criminal
                    laws are offenses defined in or covered by a criminal
                    mutual legal assistance treaty in force between the
                    government of the United States and the foreign law
                    enforcement agency's government;
                ``(C) the appropriate Federal banking agency (as defined in
            section 3(q) of the Federal Deposit Insurance Act (12 U.S.C.
            1813(q))) or, in the case of a Federal credit union, the
            National Credit Union Administration, has given its prior
            approval if the materials to be provided under subparagraph (B)
            are requested by the foreign law enforcement agency for the
            purpose of investigating, or engaging in enforcement
            proceedings based on, possible violations of law by a bank, a
            savings and loan institution described in section 18(f)(3) of
            the Federal Trade Commission Act (15 U.S.C. 57a(f)(3)), or a
            Federal credit union described in section 18(f)(4) of the
            Federal Trade Commission Act (15 U.S.C. 57a(f)(4)); and
                ``(D) the foreign law enforcement agency is not from a
            country that the Secretary of State has determined, in
            accordance with section 6(j) of the Export Administration Act
            of 1979 (50 U.S.C. App. 2405(j)), has repeatedly provided
            support for acts of international terrorism, unless and until
            such determination is rescinded pursuant to section 6(j)(4) of
            that Act (50 U.S.C. App. 2405(j)(4)).
    Nothing in the preceding sentence authorizes the disclosure of material
    obtained in connection with the administration of the Federal antitrust
    laws or foreign antitrust laws (as defined in paragraphs (5) and (7),
    respectively, of section 12 of the International Antitrust Enforcement
    Assistance Act of 1994 (15 U.S.C. 6211)) to any officer or employee of
    a foreign law enforcement agency.''.
        (b) Information Supplied by and About Foreign Sources.--Section
    21(f) of the Federal Trade Commission Act (15 U.S.C. 57b-2(f)) is
    amended to read as follows--
        ``(f) Exemption From Public Disclosure.--
                ``(1) In general.--Any material which is received by the
            Commission in any investigation, a purpose of which is to
            determine whether any person may have violated any provision of
            the laws administered by the Commission, and which is provided
            pursuant to any compulsory process under this Act or which is
            provided voluntarily in place of such compulsory process shall
            not be required to be disclosed under section 552 of title 5,
            United States Code, or any other provision of law, except as
            provided in paragraph (2)(B) of this section.
                ``(2) Material obtained from a foreign source.--
                        ``(A) Except as provided in subparagraph (B) of
                    this paragraph, the Commission shall not be required to
                    disclose under section 552 of title 5, United States
                    Code, or any other provision of law--
                                ``(i) any material obtained from a foreign
                            law enforcement agency or other foreign
                            government agency, if the foreign law
                            enforcement agency or other foreign government
                            agency has requested confidential treatment, or
                            has precluded such disclosure under other use
                            limitations, as a condition of providing the
                            material;
                                ``(ii) any material reflecting a consumer
                            complaint obtained from any other foreign
                            source, if that foreign source supplying the
                            material has requested confidential treatment
                            as a condition of providing the material; or
                                ``(iii) any material reflecting a consumer
                            complaint submitted to a Commission reporting
                            mechanism sponsored in part by foreign law
                            enforcement agencies or other foreign
                            government agencies.
                        ``(B) Nothing in this subsection shall authorize
                    the Commission to withhold information from the
                    Congress or prevent the Commission from complying with
                    an order of a court of the United States in an action
                    commenced by the United States or the Commission.''.

    SEC. 7. CONFIDENTIALITY, DELAYED NOTICE OF PROCESS.

        (a) In General.--The Federal Trade Commission Act (15 U.S.C. 41 et
    seq.) is amended by inserting after section 21 the following:

    ``SEC. 21A. CONFIDENTIALITY AND DELAYED NOTICE OF COMPULSORY PROCESS
                        FOR CERTAIN THIRD PARTIES.

        ``(a) Application With Other Laws.--The Right to Financial Privacy
    Act (12 U.S.C. 3401 et seq.) and chapter 121 of title 18, United States
    Code, shall apply with respect to the Commission, except as otherwise
    provided in this section.
        ``(b) Procedures for Delay of Notification or Prohibition of
    Disclosure.--The procedures for delay of notification or prohibition of
    disclosure under the Right to Financial Privacy Act (12 U.S.C. 3401 et
    seq.) and chapter 121 of title 18, United States Code, including
    procedures for extensions of such delays or prohibitions, shall be
    available to the Commission, provided that, notwithstanding any
    provision therein--
                ``(1) a court may issue an order delaying notification or
            prohibiting disclosure (including extending such an order) in
            accordance with the procedures of section 1109 of the Right to
            Financial Privacy Act (12 U.S.C. 3409) (if notification would
            otherwise be required under that Act), or section 2705 of title
            18, United States Code, (if notification would otherwise be
            required under chapter 121 of that title), if the presiding
            judge or magistrate judge finds that there is reason to believe
            that such notification or disclosure may cause an adverse
            result, as defined in subsection (g); and
                ``(2) if notification would otherwise be required under
            chapter 121 of title 18, United States Code, the Commission may
            delay notification (including extending such a delay) upon the
            execution of a written certification in accordance with the
            procedures of section 2705 of that title if the Commission
            finds that there is reason to believe that notification may
            cause an adverse result, as defined in subsection (g).
        ``(c) Ex Parte Application by Commission.--
                ``(1) In general.--If neither notification nor delayed
            notification by the Commission is required under the Right to
            Financial Privacy Act (12 U.S.C. 3401 et seq.) or chapter 121
            of title 18, United States Code, the Commission may apply ex
            parte to a presiding judge or magistrate judge for an order
            prohibiting the recipient of compulsory process issued by the
            Commission from disclosing to any other person the existence of
            the process, notwithstanding any law or regulation of the
            United States, or under the constitution, or any law or
            regulation, of any State, political subdivision of a State,
            territory of the United States, or the District of Columbia.
            The presiding judge or magistrate judge may enter such an order
            granting the requested prohibition of disclosure for a period
            not to exceed 60 days if there is reason to believe that
            disclosure may cause an adverse result, as defined in
            subsection (g). The presiding judge or magistrate judge may
            grant extensions of this order of up to 30 days each in
            accordance with this subsection, except that in no event shall
            the prohibition continue in force for more than a total of 9
            months.
                ``(2) Application.--This subsection shall apply only in
            connection with compulsory process issued by the Commission
            where the recipient of such process is not a subject of the
            investigation or proceeding at the time such process is issued.
                ``(3) Limitation.--No order issued under this subsection
            shall prohibit any recipient from disclosing to a Federal
            agency that the recipient has received compulsory process from
            the Commission.
        ``(d) No Liability for Failure to Notify.--If neither notification
    nor delayed notification by the Commission is required under the Right
    to Financial Privacy Act (12 U.S.C. 3401 et seq.) or chapter 121 of
    title 18, United States Code, the recipient of compulsory process
    issued by the Commission under this Act shall not be liable under any
    law or regulation of the United States, or under the constitution, or
    any law or regulation, of any State, political subdivision of a State,
    territory of the United States, or the District of Columbia, or under
    any contract or other legally enforceable agreement, for failure to
    provide notice to any person that such process has been issued or that
    the recipient has provided information in response to such process. The
    preceding sentence does not exempt any recipient from liability for--
                ``(1) the underlying conduct reported;
                ``(2) a failure to comply with the record retention
            requirements under section 1104(c) of the Right to Financial
            Privacy Act (12 U.S.C. 3404), where applicable; or
                ``(3) any failure to comply with any obligation the
            recipient may have to disclose to a Federal agency that the
            recipient has received compulsory process from the Commission
            or intends to provide or has provided information to the
            Commission in response to such process.
        ``(e) Venue and Procedure.--
                ``(1) In general.--All judicial proceedings initiated by
            the Commission under the Right to Financial Privacy Act (12
            U.S.C. 3401 et seq.), chapter 121 of title 18, United States
            Code, or this section may be brought in the United States
            District Court for the District of Columbia or any other
            appropriate United States District Court. All ex parte
            applications by the Commission under this section related to a
            single investigation may be brought in a single proceeding.
                ``(2) In camera proceedings.--Upon application by the
            Commission, all judicial proceedings pursuant to this section
            shall be held in camera and the records thereof sealed until
            expiration of the period of delay or such other date as the
            presiding judge or magistrate judge may permit.
        ``(f) Section not to Apply to Antitrust Investigations or
    Proceedings.--This section shall not apply to an investigation or
    proceeding related to the administration of Federal antitrust laws or
    foreign antitrust laws as defined in paragraphs (5) and (7),
    respectively, of section 12 of the International Antitrust Enforcement
    Assistance Act of 1994 (15 U.S.C. 6211).
        ``(g) Adverse Result Defined.--For purposes of this section the
    term `adverse result' means--
                ``(1) endangering the life or physical safety of an
            individual;
                ``(2) flight from prosecution;
                ``(3) the destruction of, or tampering with, evidence;
                ``(4) the intimidation of potential witnesses; or
                ``(5) otherwise seriously jeopardizing an investigation or
            proceeding related to fraudulent or deceptive commercial
            practices or persons involved in such practices, or unduly
            delaying a trial related to such practices or persons involved
            in such practices, including, but not limited to, by--
                        ``(A) the transfer outside the territorial limits
                    of the United States of assets or records related to
                    fraudulent or deceptive commercial practices or related
                    to persons involved in such practices;
                        ``(B) impeding the ability of the Commission to
                    identify persons involved in fraudulent or deceptive
                    commercial practices, or to trace the source or
                    disposition of funds related to such practices; or
                        ``(C) the dissipation, fraudulent transfer, or
                    concealment of assets subject to recovery by the
                    Commission.''.
        (b) Conforming Amendment.--Section 16(a)(2) of the Federal Trade
    Commission Act (15 U.S.C. 56(a)(2)) is amended--
                (1) in subparagraph (C) by striking ``or'' after the
            semicolon;
                (2) in subparagraph (D) by inserting ``or'' after the
            semicolon; and
                (3) by inserting after subparagraph (D) the following:
                ``(E) under section 21A of this Act;''.

    SEC. 8. PROTECTION FOR VOLUNTARY PROVISION OF INFORMATION.

        The Federal Trade Commission Act (15 U.S.C. 41 et seq.) is further
    amended by adding after section 21A (as added by section 7 of this Act)
    the following:

    ``SEC. 21B. PROTECTION FOR VOLUNTARY PROVISION OF INFORMATION.

        ``(a) In General.--
                ``(1) No liability for providing certain material.--An
            entity described in paragraphs (2) or (3) of subsection (d)
            that voluntarily provides material to the Commission that such
            entity reasonably believes is relevant to--
                        ``(A) a possible unfair or deceptive act or
                    practice, as defined in section 5(a) of this Act; or
                        ``(B) assets subject to recovery by the Commission,
                    including assets located in foreign jurisdictions;
            shall not be liable to any person under any law or regulation
            of the United States, or under the constitution, or any law or
            regulation, of any State, political subdivision of a State,
            territory of the United States, or the District of Columbia,
            for such provision of material or for any failure to provide
            notice of such provision of material or of intention to provide
            material.
                ``(2) Limitations.--Nothing in this subsection shall be
            construed to exempt any such entity from liability--
                        ``(A) for the underlying conduct reported; or
                        ``(B) to any Federal agency for providing such
                    material or for any failure to comply with any
                    obligation the entity may have to notify a Federal
                    agency prior to providing such material to the
                    Commission.
        ``(b) Certain Financial Institutions.--An entity described in
    paragraph (1) of subsection (d) shall, in accordance with section
    5318(g)(3) of title 31, United States Code, be exempt from liability
    for making a voluntary disclosure to the Commission of any possible
    violation of law or regulation, including--
                ``(1) a disclosure regarding assets, including assets
            located in foreign jurisdictions--
                        ``(A) related to possibly fraudulent or deceptive
                    commercial practices;
                        ``(B) related to persons involved in such
                    practices; or
                        ``(C) otherwise subject to recovery by the
                    Commission; or
                ``(2) a disclosure regarding suspicious chargeback rates
            related to possibly fraudulent or deceptive commercial
            practices.
        ``(c) Consumer Complaints.--Any entity described in subsection (d)
    that voluntarily provides consumer complaints sent to it, or
    information contained therein, to the Commission shall not be liable to
    any person under any law or regulation of the United States, or under
    the constitution, or any law or regulation, of any State, political
    subdivision of a State, territory of the United States, or the District
    of Columbia, for such provision of material or for any failure to
    provide notice of such provision of material or of intention to so
    provide material. This subsection shall not provide any exemption from
    liability for the underlying conduct.
        ``(d) Application.--This section applies to the following entities,
    whether foreign or domestic:
                ``(1) A financial institution as defined in section 5312 of
            title 31, United States Code.
                ``(2) To the extent not included in paragraph (1) a bank or
            thrift institution, a commercial bank or trust company, an
            investment company, a credit card issuer, an operator of a
            credit card system, and an issuer, redeemer, or cashier of
            travelers' checks, money orders, or similar instruments.
                ``(3) A courier service, a commercial mail receiving
            agency, an industry membership organization, a payment system
            provider, a consumer reporting agency, a domain name registrar
            or registry acting as such, and a provider of alternative
            dispute resolution services.
                ``(4) An Internet service provider or provider of telephone
            services.''.

    SEC. 9. STAFF EXCHANGES.

        The Federal Trade Commission Act (15 U.S.C. 41 et seq.) is amended
    by adding after section 25 the following new section:

    ``SEC. 25A. STAFF EXCHANGES.

        ``(a) In General.--The Commission may--
                ``(1) retain or employ officers or employees of foreign
            government agencies on a temporary basis as employees of the
            Commission pursuant to section 2 of this Act, or section 3101
            or section 3109 of title 5, United States Code; and
                ``(2) detail officers or employees of the Commission to
            work on a temporary basis for appropriate foreign government
            agencies.
        ``(b) Reciprocity and Reimbursement.--The staff arrangements
    described in subsections (a) need not be reciprocal. The Commission may
    accept payment or reimbursement, in cash or in kind, from a foreign
    government agency to which this section is applicable, or payment or
    reimbursement made on behalf of such agency, for expenses incurred by
    the Commission, its members, and employees in carrying out such
    arrangements.
        ``(c) Standards of Conduct.--A person appointed under subsection
    (a)(1) shall be subject to the provisions of law relating to ethics,
    conflicts of interest, corruption, and any other criminal or civil
    statute or regulation governing the standards of conduct for Federal
    employees that are applicable to the type of appointment.''.

    SEC. 10. INFORMATION SHARING WITH FINANCIAL REGULATORS.

        Section 1112(e) of the Right to Financial Privacy Act of 1978 (12
    U.S.C. 3412(e)) is amended by inserting ``the Federal Trade
    Commission,'' after ``the Securities and Exchange Commission,''.

    SEC. 11. PRESERVATION OF EXISTING AUTHORITY.

        The authority provided by this Act, and by the Federal Trade
    Commission Act (15 U.S.C. 41 et seq.) and the Right to Financial
    Privacy Act (12 U.S.C. 3401 et seq.), as such Acts are amended by this
    Act, is in addition to, and not in lieu of, any other authority vested
    in the Federal Trade Commission or any other officer of the United
    States.

    SEC. 12. REPORT.

        Not later than 3 years after the date of enactment of this Act, the
    Federal Trade Commission shall transmit to Congress a report describing
    its use of and experience with the authority granted by this Act, along
    with any recommendations for additional legislation. The report shall
    include--
                (1) the number of cross-border complaints received by the
            Commission;
                (2) identification of the foreign agencies to which the
            Commission has provided nonpublic investigative information
            under this Act;
                (3) the number of times the Commission has used compulsory
            process on behalf of foreign law enforcement agencies pursuant
            to section 6 of the Federal Trade Commission Act (15 U.S.C.
            46), as amended by section 4 of this Act;
                (4) a list of international agreements and memoranda of
            understanding executed by the Commission that relate to this
            Act;
                (5) the number of times the Commission has sought delay of
            notice pursuant to section 21A of the Federal Trade Commission
            Act, as added by section 7 of this Act, and the number of times
            a court has granted a delay;
                (6) a description of the types of information private
            entities have provided voluntarily pursuant to section 21B of
            the Federal Trade Commission Act, as added by section 8 of this
            Act;
                (7) a description of the results of cooperation with
            foreign law enforcement agencies under section 21 of the
            Federal Trade Commission Act (15 U.S.C. 57-2) as amended by
            section 6 of this Act;
                (8) an analysis of whether the lack of an exemption from
            the disclosure requirements of section 552 of title 5, United
            States Code, with regard to information or material voluntarily
            provided relevant to possible unfair or deceptive acts or
            practices, has hindered the Commission in investigating or
            engaging in enforcement proceedings against such practices; and
                (9) a description of Commission litigation brought in
            foreign courts.

                              Purpose and Summary

        H.R. 3143, the ``International Consumer Protection Act of
    2003'' or (``ICPA'') empowers the Federal Trade Commission
    (``FTC'') to combat transnational fraudulent and deceptive
    commercial practices by granting it new enforcement and
    information sharing powers and allowing it to enter into
    agreements with its counterpart foreign law enforcement and
    consumer protection authorities. The ICPA will combat the
    growing problem of cross-border fraud and deception perpetrated
    from foreign jurisdictions or by foreign individuals that
    adversely affect U.S. consumers and businesses. The legislation
    also allows cooperation by the FTC with its foreign
    counterparts in cases involving U.S. entities or persons
    defrauding foreign consumers.

                    Background and Need for the Legislation

        The advent of the Internet, improved telecommunications,
    and the globalization of the economy have created incredible
    opportunities by shrinking distances and blurring traditional
    barriers. However, some of the international opportunities
    being created today are not for legislative entrepreneurs and
    consumers, but for more criminal's who seek to deceive and
    defraud. What might be called ``cross-border fraud'' is a
    burgeoning problem involving those who establish operations in
    one country, and use communications that may cross multiple
    national borders to deceive or defraud consumers in other
    countries.
        An increasing number of consumer complaints collected in
    the Consumer Sentinel database maintained by the FTC, and an
    increasing number of cases brought by it, involve foreign
    consumers, foreign businesses or individuals, or assets or
    evidence located outside the United States. In 2002, according
    to the FTC, 14% of the complaints in the Consumer Sentinel
    database (excluding identity theft complaints) were cross-
    border complaints, up from 11% in 2000. The 2002 complaints
    include over 24,000 complaints by U.S. consumers against
    foreign businesses.
        Increasingly, the FTC reports that its fraud or deceptive
    practices related investigations and cases have some
    transnational component. For instance, a typical spam related
    case may involve a foreign sender or an e-mail message that
    crosses several national boundaries en route to its final
    destination. To better enforce existing fraud and consumer
    protection laws and meet the enforcement expectations of
    Congress, the FTC believes better international cooperation and
    additional tools are critical.
        The Committee has been informed by the FTC that the
    additional authority provided to it in this legislation mirrors
    existing authority given to the Securities and Exchange
    Commission and some other regulatory agencies. The Committee
    understands that the legislation is not intended to be a bold
    departure giving unprecedented authorities to the FTC but
    rather is intended to harmonize the FTC's international
    enforcement and investigatory powers with those of other
    similar independent regulatory agencies.
        The Committee's favorably reported this legislation with an
    amendment that represents the product of discussions between
    the FTC and DOJ. This action represents a judgment that the
    amendment has improved the bill in some respects: 1)
    incorporating a greater consultative role for the Attorney
    General when the FTC interacts and makes agreements with
    foreign law enforcement agencies or engages in foreign
    litigation; 2) preventing interference with Memoranda of
    Understanding (``MOU'') with other countries on criminal
    matters and the referral of information related to criminal
    violations with the Department of Justice; 3) including greater
    safeguards for the sharing of information on U.S. citizens and
    entities with foreign consumer protection authorities; 4)
    ensuring (because of a concern raised by the Committee) that
    state sponsors of terrorism do not receive cooperation or
    information; 5) placing greater limits on use of materials
    obtained by FTC's compulsory process powers; 6) placing greater
    limits on use of delayed notice by the FTC when information is
    sought from third parties that are not the target of an
    investigation; and 7) improving the Federal Government's
    liability exposure when the FTC employs volunteer services by
    mirroring language of the Volunteer Protection Act of 1997 \1\
    rather than the Federal Tort Claims Act.
    ---------------------------------------------------------------------------
        \1\ Pub. L. No. 105-19; codified at 42 U.S.C. Sec. 14503 et. seq.
    (2003).
    ---------------------------------------------------------------------------
        As the House Committee on Energy and Commerce noted in its
    report on H.R. 3143, this legislation: ``will likely improve
    the ability of the Commission and its foreign counterparts to
    share information about cross-border fraud and deception, to
    conduct joint and parallel investigations [to], render
    assistance to each other'' and it ``is critical to achieve more
    timely and effective enforcement in cross-border cases.'' \2\
    The Committee on the Judiciary does not dispute these findings
    about the merits and necessity of the legislation, and it is
    concerned about the growing threat of trans-border fraud and
    deceptive practices.
    ---------------------------------------------------------------------------
        \2\ H.R. Rept. No. 108-635, Part 1, page 2 (2004)
    ---------------------------------------------------------------------------
        However, the legislation has drawn some criticism from
    interest groups concerned about information sharing with
    foreign governments, the potential for FTC investigation of
    American citizens for activities that may be legal under U.S.
    law but which are violations of foreign law, the circumstances
    under which delayed notice may be used against the target of an
    FTC investigation, and exceptions to the Freedom of Information
    Act (``FOIA''). While the Committee believes that the amended
    version of the legislation reported by the Committee, (which
    embodies the text of H.R. 4996 as introduced) makes
    improvements in all of these areas, concerns remain about the
    scope of the powers sought, the FTC's need for them, and the
    existence of adequate due process and privacy safeguards.
        If this legislation becomes law, the Committee expects to
    closely monitor the Commission's use of the resulting new
    powers. The Committee believes it will be joined in these
    oversight efforts by other committees of Congress and Executive
    branch agencies in supervising the Commission's employment of
    these new powers and monitoring the level of cooperation the
    Commission receives from foreign counterpart agencies. The
    foremost oversight concern should be any abuses of information
    shared about U.S. entities or persons with foreign consumer
    protection authorities. The reporting requirements contained in
    the legislation are serious, and the FTC should be on notice
    that these new authorities can easily be revoked if they are
    not used properly or if Congress does not receive adequate
    information concerning the FTC's employment of them.

                                    Hearings

        No hearings were held by the Committee on the Judiciary on
    H.R. 3143 or H.R. 4996.

                            Committee Consideration

        On September 30, 2004, the Committee met in open session
    and ordered favorably reported the bill H.R. 3143, with an
    amendment, by voice vote, a quorum being present.

                             Vote of the Committee

        In compliance with clause 3(b) of rule XIII of the Rules of
    the House of Representatives, the Committee notes that there
    were no recorded votes during the committee's consideration of
    H.R. 3143.

                          Committee Oversight Findings

        In compliance with clause 3(c)(1) of rule XIII of the Rules
    of the House of Representatives, the Committee reports that the
    findings and recommendations of the Committee, based on
    oversight activities under clause 2(b)(1) of rule X of the
    Rules of the House of Representatives, are incorporated in the
    descriptive portions of this report.

                   New Budget Authority and Tax Expenditures

        Clause 3(c)(2) of rule XIII of the Rules of the House of
    Representatives is inapplicable because this legislation does
    not provide new budgetary authority or increased tax
    expenditures.

                   Congressional Budget Office Cost Estimate

        In compliance with clause 3(c)(3) of rule XIII of the Rules
    of the House of Representatives, the Committee sets forth, with
    respect to the bill, H.R. 3143, the following estimate and
    comparison prepared by the Director of the Congressional Budget
    Office under section 402 of the Congressional Budget Act of
    1974:

                                         U.S. Congress,
                                   Congressional Budget Office,
                                      Washington, DC, October 14, 2004.
    Hon. F. James Sensenbrenner, Jr., Chairman,
    Committee on the Judiciary,
    House of Representatives, Washington, DC.
        Dear Mr. Chairman: The Congressional Budget Office has
    prepared the enclosed cost estimate for H.R. 3143, the
    International Consumer Protection Act of 2004.
        If you wish further details on this estimate, we will be
    pleased to provide them. The CBO staff contacts are Melissa E.
    Zimmerman (for federal costs), who can be reached at 226-2860,
    Sarah Puro (for the impact on state and local governments), who
    can be reached at 225-3220, and Selena Caldera (for the
    private-sector impact), who can be reached at 226-2940.
                Sincerely,
                                           Douglas Holtz-Eakin.

    Enclosure

    cc:
            Honorable John Conyers, Jr.
            Ranking Member
    H.R. 3143--International Consumer Protection Act of 2004.
        H.R. 3143 would expand the authority of the Federal Trade
    Commission (FTC) to work with foreign law enforcement agencies
    to enforce laws prohibiting fraudulent and deceptive commercial
    practices. The bill would allow temporary staff exchanges
    between foreign government agencies and the FTC and would
    authorize the agency to accept payment in-kind or reimbursement
    for costs associated with such exchanges. It also would
    authorize the appropriation of up to $100,000 a year for the
    FTC to support activities of certain international law
    enforcement groups.
        Assuming appropriation of the amounts specified in H.R.
    3143, CBO estimates that implementing the bill would cost less
    than $500,000 over the 2004-2008 period. Enacting the bill
    would not affect direct spending or revenues.
        H.R. 3143 would authorize the FTC to request that a judge
    order the recipient of a summons, subpoena, or other compulsory
    process to delay giving notice to anyone that they have been
    required to appear as a witness before, or to produce documents
    in, an FTC proceeding. The order could be issued,
    notwithstanding any State or local laws or regulations, if
    there is reason to believe that notification would cause
    certain adverse results. Further, the recipient would not be
    liable under any State or local laws or regulations for
    disclosing information or for failure to provide notice. The
    bill also would protect certain entities that voluntarily
    provide specified material to the FTC from liability under any
    State or local law or regulation that precludes disclosure of
    information or requires notification to the interested third
    party.
        To the extent that State and local governments have laws
    that contradict these provisions, the legislation would preempt
    those laws and thereby impose mandates under the Unfunded
    Mandates Reform Act (UMRA). CBO estimates that the cost of
    those mandates would be minimal and would not exceed the
    threshold established in UMRA ($60 million in 2004, adjusted
    annually for inflation).
        H.R. 3143 would exempt from liability those entities
    providing certain information on third parties to the FTC. This
    exemption would limit the ability of a third party to sue and
    thus impose a private-sector mandate under UMRA. CBO estimates
    that the cost to the private sector would be minimal and would
    fall below the annual threshold for private-sector mandates
    established in UMRA ($120 million in 2004, adjusted annually
    for inflation).
        Section 21B of the Federal Trade Commission Act, as amended
    by H.R. 3143, would protect from liability entities voluntarily
    providing information to the FTC about possible unfair or
    deceptive acts or practices of third parties. By exempting
    those entities from liability, H.R. 3143 would limit the
    ability of third parties to sue for disclosure or failure to
    provide notice of disclosure; such a limit constitutes a
    private-sector mandate under UMRA. The direct cost of the
    mandate would be the amount awarded in settlements and
    judgments (net of costs) to third parties under current law
    that would be precluded under H.R. 3143. Due to the exposure to
    liability under current law, entities do not voluntarily
    provide information on third parties to the FTC. CBO estimates
    the costs to the private sector would be minimal, since few, if
    any, third-party lawsuits are filed.
        On July 9, 2003, CBO transmitted a cost estimate for S.
    1234, the Federal Trade Commission Reauthorization Act of 2003,
    as ordered reported by the Senate Committee on Commerce,
    Science, and Transportation on June 19, 2003. On October 8,
    2003, CBO transmitted a cost estimate for H.R. 3143, the
    International Consumer Protection Act of 2003, as ordered
    reported by the House Committee on Energy and Commerce on
    October 1, 2003. H.R. 3143, as ordered reported by the House
    Committee on the Judiciary, is nearly identical to the version
    of H.R. 3143 that was ordered reported by the House Committee
    on Energy and Commerce. The bill contains similar provisions to
    those in title II of S. 1234, although S. 1234 would authorize
    funding for all operations of the FTC, and this bill would
    authorize funding only for support to certain international
    law-enforcement groups. All three bills would preempt State and
    local law in the same way and would impose the same private-
    sector mandate.
        The CBO staff contacts for this estimate are Melissa E.
    Zimmerman (for federal costs), who can be reached at 226-2860,
    Sara Puro (for the impact on State and local governments), who
    can be reached at 225-3220, and Selena Caldera (for the
    private-sector impact), who can be reached at 226-2940. This
    estimate was approved by Peter H. Fontaine, Deputy Assistant
    Director for Budget Analysis.

                        Performance Goals and Objectives

        The Committee states that pursuant to clause 3(c)(4) of
    rule XIII of the Rules of the House of Representatives, H.R.
    3143 is intended to protect consumers from cross border fraud
    and deceptive commercial practices by improving the ability of
    the Federal Trade Commission to cooperate with foreign
    counterpart agencies and pursue perpetrators and the profits of
    their conduct that are located in foreign jurisdictions.

                       Constitutional Authority Statement

        Pursuant to clause 3(d)(1) of rule XIII of the Rules of the
    House of Representatives, the Committee finds the authority for
    this legislation in article I, Sec. 8 of the Constitution.

                   Section-by-Section Analysis and Discussion

        Section 1. Short Title. Section 1 establishes the short
    title of the Act as the ``International Consumer Protection Act
    of 2003.''
        Section 2. Foreign Law Enforcement Agency Defined. Section
    2 amends Sec. 4 of the Federal Trade Commission Act by adding a
    definition of ``foreign law enforcement agency.'' It is defined
    as: (1) any agency or judicial authority of a foreign
    government, including a foreign state, a political subdivision
    of a foreign state, or a multinational organization constituted
    by and comprised of foreign states, that is vested with law
    enforcement or investigative authority in civil, criminal, or
    administrative matters; or, (2) any multinational multi-agency
    organization to the extent that it is acting on behalf of an
    entity described in subparagraph (A). This definition is
    integral to the new powers related to court proceedings given
    to the FTC throughout the bill.
        Section 3. Availability of Remedies. Section 3 amends
    Sec. 5(a) of the Federal Trade Commission Act extending the
    remedies available under that section to ``unfair or deceptive
    acts or practices'' involving foreign commerce. that: (1) cause
    or are likely to cause reasonably foreseeable injury within the
    United States; or (2) involve material conduct occurring within
    the United States. Some of these remedies are administrative
    and some involve court proceedings. The language extends both
    types of these remedies to an entirely new area. See generally
    15 U.S.C. Sec. 45.
        Section 4. Powers of the Commission. Section 4 adds new
    language to Sec. 6 of the FTCA (15 U.S.C. Sec. 46). First,
    Sec. 4(a) of H.R. 3143 amends Sec. 6 of the FTCA to allow the
    FTC to reveal confidential business information that it has
    gathered in its investigations to foreign law enforcement
    agencies. This information may include matters relevant to
    criminal investigations that are being conducted by the
    Department of Justice. Second, Sec. 4(b) creates new
    subsections (j), (k), and (l) of Sec. 6 of the FTCA. New
    subsection (j) gives the FTC broad new powers to share law
    enforcement information with foreign law enforcement agencies,
    to conduct investigations on their behalf, and to enter into
    international agreements with them. New subsection (k) empowers
    the FTC to receive information relating to criminal matters
    from foreign law enforcement authorities and to refer it to the
    Department of Justice. New subsection (l) authorizes the FTC to
    spend appropriated funds for such purposes. Third, Sec. 4(c)
    authorizes the expenditure of $100,000 per fiscal year for the
    purposes of the new subsection (l).
        Section 5. Representation in Foreign Litigation. Section 5
    amends Sec. 16 of the Federal Trade Commission Act by adding a
    new Sec. 16(c) to the FTCA (15 U.S.C. Sec. 56) providing that
    the FTC can designate FTC attorneys to assist the Attorney
    General in the conduct of foreign litigation relating to the
    FTC (pursuant to a memorandum of understanding to be negotiated
    between the Commission and the Attorney General) and to spend
    appropriated funds to hire foreign attorneys to represent it in
    foreign courts. The subsection also contains a disclaimer that
    the subsection does not authorize the payment of claims from
    any source other than the judgment fund. This language has
    implications for the power of the Attorney General to direct
    litigation on behalf of the United States. See 28 U.S.C.
    Sec. 516.
        Section 6. Sharing Information with Foreign Law Enforcement
    Agencies. Section 6 adds new language to Sec. 21(b)(6) of the
    FTCA (15 U.S.C. Sec. 57b-2(b)(6)) that would allow the FTC to
    turn over information that it has obtained by compulsory
    process enforced by U.S. Federal courts to foreign law
    enforcement agencies investigating civil and criminal law
    violations subject to certain conditions. This section provides
    that the Commission may make material obtained pursuant to
    compulsory process available to any foreign law enforcement
    agency upon appropriate certification that such material will
    be maintained in confidence and will be used only for official
    law enforcement purposes. The materials are to be used for
    purposes of investigating, or engaging in enforcement
    proceedings related to, possible violations of: (1) foreign
    laws prohibiting fraudulent or deceptive commercial practices
    or other practices, substantially similar to practices
    prohibited by any law administered by the Commission; (2) a law
    administered by the Commission, if disclosure of the material
    would further a Commission investigation or enforcement
    proceeding; or (3) with the approval of the Attorney General,
    other foreign criminal laws, if such foreign criminal laws are
    offenses defined or covered by a criminal mutual legal
    assistance treaty in force between the United States and the
    foreign law enforcement authority's state. However, the FTC
    shall not make available such material to a foreign law
    enforcement agency where the activity the person is engaged in
    is protected under the Constitution of the United States.
        Section 6 also exempts from the Freedom of Information Act,
    except in limited circumstances, all information that the FTC
    receives in any investigation from a foreign law enforcement or
    consumer protection agency as well as consumer complaint
    information received from non-governmental foreign sources when
    the agency or foreign source providing the material requests
    confidentiality as a condition of providing the information.
    However, this subsection does not authorize the Commission to
    withhold information from the Congress or prevent the
    Commission from complying with an order of a court in an action
    commenced by the Commission or the United States.
        Section 7. Confidentiality, Delayed Notice of Process.
    Section 7 creates a new Sec. 21A of the FTCA. This section
    gives the FTC power to use the provisions of the Electronic
    Communications Privacy Act, including the delayed notice
    provisions. See 18 U.S.C. Sec. 2701 et seq. The new section
    also establishes court procedures for the use of these powers.
    In general, the procedures for delay or prohibition of notice
    under the Electronic Communications Privacy Act (18 U.S.C.
    Sec. 2701 et seq.) are also made available to the Commission.
    In the case of ECPA, the notification is delayed pursuant to
    Sec. 2705(a)(1)(B) of Title 18, upon a finding by the
    Commission that there is reason to believe that notification
    may cause an ``adverse result.'' If the procedures for delay or
    prohibition of notice under the Right to Financial Privacy Act
    and the Electronic Communications Privacy Act do not apply,
    under Sec. 21(A)(c) the Commission may apply ex parte to a
    presiding judge or magistrate judge for an order commanding the
    recipient of compulsory process issued by the Commission not to
    notify any other person of the existence of the process,
    notwithstanding any other law. The presiding judge or
    magistrate judge may, in turn, enter such an order granting the
    requested delay for a period not to exceed 60 days, if there is
    reason to believe that notification may cause an adverse
    result. The presiding judge or magistrate judge may grant
    extensions of this delay of notice of up to 30 days each in
    accordance with this subsection, provided that in no event
    shall the notice be delayed for more than a total of 9 months.
    The recipient of compulsory process issued by the Commission
    under this Sec. 21(A)(d) shall not be liable under any law or
    under any contract or other legally enforceable agreement, for
    failure to provide notice that such process has been issued or
    that the recipient has provided information in response to such
    process. In doing so, the recipient is not provided with any
    exemption from liability for: (1) the underlying conduct
    reported; (2) noncompliance with the record retention
    requirements under Sec. 3404 of title 12; or (3) noncompliance
    with any requirement of a Federal Government agency to disclose
    information to that agency. For purposes of this section, the
    term ``adverse result'' is defined in detail.20
        Section 8. Protection for Voluntary Provision of
    Information. Section 8 creates a new Sec. 21B of the FTCA. This
    section gives immunity from suit to various persons or entities
    who voluntarily disclose information to the FTC that may help
    it in an investigation if the entity reasonably believes that
    such disclosures are relevant to possible unfair or deceptive
    practices, or assets subject to recovery by the Commission,
    including assets located in overseas. The section does not
    provide any exemption from liability for the underlying
    conduct.
        Section 9. Staff Exchanges. Section 9 creates a new
    Sec. 25A of the FTCA. This section gives the FTC authority to
    exchange employees with foreign law enforcement authorities and
    it makes those foreign law enforcement
        Section 10. Information Sharing with Financial Regulators.
    Section 10 amends Sec. 1112(e) of the Right to Financial
    Privacy Act (12 U.S.C. Sec. 3412(e)) by adding ``the Federal
    Trade Commission'' after ``the Securities and Exchange
    Commission.'' This includes the FTC in an exemption that allows
    Federal financial and market regulators, including the SEC, to
    share financial records, examination reports, or other
    appropriate information.
        Section 11. Report. Section 11 requires the FTC to report
    to Congress not later than 3 years after the date of enactment
    on the use of the various new authorities granted by the Act.

                                  Agency Views

             Changes in Existing Law Made by the Bill, as Reported

      In compliance with clause 3(e) of rule XIII of the Rules of
    the House of Representatives, changes in existing law made by
    the bill, as reported, are shown as follows (existing law
    proposed to be omitted is enclosed in black brackets, new
    matter is printed in italics, existing law in which no change
    is proposed is shown in roman):

                          FEDERAL TRADE COMMISSION ACT

               *       *       *       *       *       *       *
        Sec. 4. The words defined in this section shall have the
    following meaning when found in this Act, to wit:
        ``Commerce'' means commerce among the several States or
    with foreign nations, or in any Territory of the United States
    or in the District of Columbia, or between any such Territory
    and another, or between any such Territory and any State or
    foreign nation, or between the District of Columbia and any
    State or Territory or foreign nation.
        ``Corporation'' shall be deemed to include any company,
    trust, so-called Massachusetts trust, or association,
    incorporated or unincorporated, which is organized to carry on
    business for its own profit or that of its members, and has
    shares of capital or capital stock or certificates of interest,
    and any company, trust, so-called Massachusetts trust, or
    association, incorporated or unincorporated, without shares of
    capital or capital stock or certificates of interest, except
    partnerships, which is organized to carry on business for its
    own profit or that of its members.
        ``Documentary evidence'' includes all documents, papers,
    correspondence, books of account, and financial and corporate
    records.
        ``Acts to regulate commerce'' means the Act entitled ``An
    Act to regulate commerce,'' approved February 14, 1887, and all
    Acts amendatory thereof and supplementary thereto and the
    Communications Act of 1934 and all Acts amendatory thereof and
    supplementary thereto.
        ``Antitrust Acts'' means the Act entitled ``An Act to
    protect trade and commerce against unlawful restraints and
    monopolies,'' approved July 2, 1890; also sections 73 to 76,
    inclusive, of an Act entitled ``An Act to reduce taxation, to
    provide revenue for the Government, and for other purposes,''
    approved August 27, 1894; also the Act entitled ``An Act to
    amend sections 73 and 76 of the Act of August 27, 1894,
    entitled `An Act to reduce taxation, to provide revenue for the
    Government, and for other purposes,' '' approved February 12,
    1913; and also the Act entitled ``An Act to supplement existing
    laws against unlawful restraints and monopolies, and for other
    purposes,'' approved October 15, 1914.
                ``Banks'' means the types of banks and other
            financial institutions referred to in section 18(f)(2).
        ``Foreign law enforcement agency'' means--
                (A) any agency or judicial authority of a foreign
            government, including a foreign state, a political
            subdivision of a foreign state, or a multinational
            organization constituted by and comprised of foreign
            states, that is vested with law enforcement or
            investigative authority in civil, criminal, or
            administrative matters; and
                (B) any multinational or multiagency organization
            to the extent that it is acting on behalf of an entity
            described in subparagraph (A).
        Sec. 5. (a)(1) * * *

               *       *       *       *       *       *       *

        (4)(A) For purposes of this subsection, the term ``unfair
    or deceptive acts or practices'' shall include such acts or
    practices involving foreign commerce that--
                (i) cause or are likely to cause reasonably
            foreseeable injury within the United States; or
                (ii) involve material conduct occurring within the
            United States.
        (B) All remedies available to the Commission with respect
    to unfair and deceptive acts or practices shall be available
    for acts and practices described in this paragraph, including
    restitution to domestic or foreign victims.

               *       *       *       *       *       *       *

        Sec. 6. That the commission shall also have power--
        (a) * * *

               *       *       *       *       *       *       *

        (f) To make public from time to time such portions of the
    information obtained by it hereunder as are in the public
    interest; and to make annual and special reports to the
    Congress and to submit therewith recommendations for additional
    legislation; and to provide for the publication of its reports
    and decisions in such form and manner as may be best adapted
    for public information and use: Provided, That the Commission
    shall not have any authority to make public any trade secret or
    any commercial or financial information which is obtained from
    any person and which is privileged or confidential, except that
    the Commission may disclose such information (1) to officers
    and employees of appropriate Federal law enforcement agencies
    or to any officer or employee of any State law enforcement
    agency upon the prior certification of an officer of any such
    Federal or State law enforcement agency that such information
    will be maintained in confidence and will be used only for
    official law enforcement [purposes.] purposes, and (2) to any
    officer or employee of any foreign law enforcement agency under
    the same circumstances that making material available to
    foreign law enforcement agencies is permitted under section
    21(b).

               *       *       *       *       *       *       *

        (j) Investigative Assistance for Foreign Law Enforcement
    Agencies.--
                (1) In general.--Upon a written request from a
            foreign law enforcement agency to provide assistance in
            accordance with this subsection, if the requesting
            agency states that it is investigating, or engaging in
            enforcement proceedings against, possible violations of
            laws prohibiting fraudulent or deceptive commercial
            practices, or other practices substantially similar to
            practices prohibited by any provision of the laws
            administered by the Commission, other than Federal
            antitrust laws (as defined in section 12(5) of the
            International Antitrust Enforcement Assistance Act of
            1994 (15 U.S.C. 6211(5))), the Commission may provide
            the assistance described in paragraph (2) without
            requiring that the conduct identified in the request
            constitute a violation of the laws of the United
            States.
                (2) Type of assistance.--In providing assistance to
            a foreign law enforcement agency under this subsection,
            the Commission may--
                        (A) conduct such investigation as the
                    Commission deems necessary to collect
                    information and evidence pertinent to the
                    request for assistance, using all investigative
                    powers authorized by this Act; and
                        (B) when the request is from an agency
                    acting to investigate or pursue the enforcement
                    of civil laws, or when the Attorney General
                    refers a request to the Commission from an
                    agency acting to investigate or pursue the
                    enforcement of criminal laws, seek and accept
                    appointment by a United States district court
                    of Commission attorneys to provide assistance
                    to foreign and international tribunals and to
                    litigants before such tribunals on behalf of a
                    foreign law enforcement agency pursuant to
                    section 1782 of title 28, United States Code.
                (3) Criteria for determination.--In deciding
            whether to provide such assistance, the Commission
            shall consider all relevant factors, including--
                        (A) whether the requesting agency has
                    agreed to provide or will provide reciprocal
                    assistance to the Commission;
                        (B) whether compliance with the request
                    would prejudice the public interest of the
                    United States; and
                        (C) whether the requesting agency's
                    investigation or enforcement proceeding
                    concerns acts or practices that cause or are
                    likely to cause injury to a significant number
                    of persons.
                (4) International agreements.--If a foreign law
            enforcement agency has set forth a legal basis for
            requiring execution of an international agreement as a
            condition for reciprocal assistance, or as a condition
            for provision of materials or information to the
            Commission, the Commission, with prior approval and
            ongoing oversight of the Secretary of State, and with
            final approval of the agreement by the Secretary of
            State, may negotiate and conclude an international
            agreement, in the name of either the United States or
            the Commission, for the purpose of obtaining such
            assistance, materials, or information. The Commission
            may undertake in such an international agreement to--
                        (A) provide assistance using the powers set
                    forth in this subsection;
                        (B) disclose materials and information in
                    accordance with subsection (f) and section
                    21(b); and
                        (C) engage in further cooperation, and
                    protect materials and information received from
                    disclosure, as authorized by this Act.
                (5) Additional authority.--The authority provided
            by this subsection is in addition to, and not in lieu
            of, any other authority vested in the Commission or any
            other officer of the United States.
                (6) Limitation.--The authority granted by this
            subsection shall not authorize the Commission to take
            any action or exercise any power with respect to a
            bank, a savings and loan institution described in
            section 18(f)(3) (15 U.S.C. 57a(f)(3)), a Federal
            credit union described in section 18(f)(4) (15 U.S.C.
            57a(f)(4)), or a common carrier subject to the Act to
            regulate commerce, except in accordance with the
            proviso following the last designated subsection of
            section 6 (15 U.S.C. 46).
                (7) Assistance to certain countries.--The
            Commission may not provide investigative assistance
            under this subsection to a foreign law enforcement
            agency from a foreign state that the Secretary of State
            has determined, in accordance with section 6(j) of the
            Export Administration Act of 1979 (50 U.S.C. App.
            2405(j)), has repeatedly provided support for acts of
            international terrorism, unless and until such
            determination is rescinded pursuant to section 6(j)(4)
            of that Act (50 U.S.C. App. 2405(j)(4)).
        (k) Referral of Evidence for Criminal Proceedings.--
                (1) In general.--Whenever the Commission obtains
            evidence that any person, partnership, or corporation,
            either domestic or foreign, has engaged in conduct that
            may constitute a violation of Federal criminal law, the
            Commission may transmit such evidence to the Attorney
            General, who may institute criminal proceedings under
            appropriate statutes. Nothing in this paragraph affects
            any other authority of the Commission to disclose
            information.
                (2) International information.--The Commission
            shall endeavor to ensure, with respect to memoranda of
            understanding and international agreements it may
            conclude, that material it has obtained from foreign
            law enforcement agencies acting to investigate or
            pursue the enforcement of foreign criminal laws may be
            used for the purpose of investigation, prosecution, or
            prevention of violations of United States criminal
            laws.
        (l) Expenditures for Cooperative Arrangements.--The
    Commission may expend appropriated funds for--
                (1) operating expenses and other costs of bilateral
            and multilateral cooperative law enforcement groups
            conducting activities of interest to the Commission and
            in which the Commission participates; and
                (2) expenses for consultations and meetings hosted
            by the Commission with foreign government agency
            officials, members of their delegations, appropriate
            representatives and staff to exchange views concerning
            developments relating to the Commission's mission,
            development and implementation of cooperation
            agreements, and provision of technical assistance for
            the development of foreign consumer protection or
            competition regimes, such expenses to include necessary
            administrative and logistic expenses and the expenses
            of Commission staff and foreign invitees in attendance
            at such consultations and meetings including--
                        (A) such incidental expenses as meals taken
                    in the course of such attendance;
                        (B) any travel and transportation to or
                    from such meetings; and
                        (C) any other related lodging or
                    subsistence.
    Provided, That the exception of ``banks, savings and loan
    institutions described in section 18(f)(3), Federal credit
    unions described in section 18(f)(4), and common carriers
    subject to the Act to regulate commerce'' from the Commission's
    powers defined in [clauses (a) and (b)] subsections (a), (b),
    and (j) of this section, shall not be construed to limit the
    Commission's authority to gather and compile information to
    investigate, or to require reports or answers from, any person,
    partnership, or corporation to the extent that such action is
    necessary to the investigation of any person, partnership, or
    corporation, group of persons, partnerships, or corporations,
    or industry which is not engaged, or is engaged only
    incidentally in banking, in business as a savings and loan
    institution, in business as a Federal credit union, or in
    business as a common carrier subject to the Act to regulate
    commerce.
        The Commission shall establish a plan designed to
    substantially reduce burdens imposed upon small businesses as a
    result of requirements established by the Commission under
    clause (b) relating to the filing of quarterly financial
    reports. Such plan shall (1) be established after consultation
    with small businesses and persons who use the information
    contained in such quarterly financial reports; (2) provide for
    a reduction of the number of small businesses required to file
    such quarterly financial reports; and (3) make revisions in the
    forms used for such quarterly financial reports for the purpose
    of reducing the complexity of such forms. The Commission, not
    later than December 31, 1980, shall submit such plan to the
    Committee on Commerce, Science, and Transportation of the
    Senate and to the Committee on Energy and Commerce of the House
    of Representatives. Such plan shall take effect not later than
    October 31, 1981.
        No officer or employee of the Commission or any
    Commissioner may publish or disclose information to the public,
    or to any Federal agency, whereby any line-of-business data
    furnished by a particular establishment or individual can be
    identified. No one other than designated sworn officers and
    employees of the Commission may examine the line-of-business
    reports from individual firms, and information provided in the
    line-of-business program administered by the Commission shall
    be used only for statistical purposes. Information for carrying
    out specific law enforcement responsibilities of the Commission
    shall be obtained under practices and procedures in effect on
    the date of the enactment of the Federal Trade Commission
    Improvements Act of 1980, or as changed by law.
        Nothing in this section (other than the provisions of
    clause (c) and clause (d)) shall apply to the business of
    insurance, except that the Commission shall have authority to
    conduct studies and prepare reports relating to the business of
    insurance. The Commission may exercise such authority only upon
    receiving a request which is agreed to by a majority of the
    members of the Committee on Commerce, Science, and
    Transportation of the Senate or the Committee on Energy and
    Commerce of the House of Representatives. The authority to
    conduct any such study shall expire at the end of the Congress
    during which the request for such study was made.

               *       *       *       *       *       *       *

        Sec. 16. (a)(1) * * *
        (2) Except as otherwise provided in paragraph (3), in any
    civil action--
                (A) * * *

               *       *       *       *       *       *       *

                (C) to obtain judicial review of a rule prescribed
            by the Commission, or a cease and desist order issued
            under section 5 of this Act; [or]
                (D) under the second paragraph of section 9 of this
            Act (relating to enforcement of a subpena) and under
            the fourth paragraph of such section (relating to
            compliance with section 6 of this Act); or
                (E) under section 21A of this Act;

               *       *       *       *       *       *       *

        (c) Foreign Litigation.--
                (1) Commission attorneys.--With the concurrence of
            the Attorney General, the Commission may designate
            Commission attorneys to assist the Attorney General in
            connection with litigation in foreign courts on
            particular matters in which the Commission has an
            interest.
                (2) Reimbursement for foreign counsel.--The
            Commission is authorized to expend appropriated funds,
            upon agreement with the Attorney General, to reimburse
            the Attorney General for the retention of foreign
            counsel for litigation in foreign courts, and for
            expenses related to litigation in foreign courts in
            which the Commission has an interest.
                (3) Limitation on use of funds.--Nothing in this
            subsection authorizes the payment of claims or
            judgments from any source other than the permanent and
            indefinite appropriation authorized by section 1304 of
            title 31, United States Code.
                (4) Other authority.--The authority provided by
            this subsection is in addition to any other authority
            of the Commission or the Attorney General.

               *       *       *       *       *       *       *

        Sec. 21. (a) * * *
        (b)(1) * * *

               *       *       *       *       *       *       *

        (6) The custodian of any documentary material, written
    reports or answers to questions, and transcripts of oral
    testimony may deliver to any officers or employees of
    appropriate Federal law enforcement agencies, in response to a
    written request, copies of such material for use in connection
    with an investigation or proceeding under the jurisdiction of
    any such agency. The custodian of any tangible things may make
    such things available for inspection to such persons on the
    same basis. Such materials shall not be made available to any
    such agency until the custodian receives certification of any
    officer of such agency that such information will be maintained
    in confidence and will be used only for official law
    enforcement purposes. Such documentary material, results of
    inspections of tangible things, written reports or answers to
    questions, and transcripts of oral testimony may be used by any
    officer or employee of such agency only in such manner and
    subject to such conditions as apply to the Commission under
    this section. The custodian may make such materials available
    to any State law enforcement agency upon the prior
    certification of any officer of such agency that such
    information will be maintained in confidence and will be used
    only for official law enforcement purposes. The custodian may
    make such material available to any foreign law enforcement
    agency upon the prior certification of an appropriate official
    of any such foreign law enforcement agency, either by a prior
    agreement or memorandum of understanding with the Commission or
    by other written certification, that such material will be
    maintained in confidence and will be used only for official law
    enforcement purposes, if--
                (A) the foreign law enforcement agency has set
            forth a bona fide legal basis for its authority to
            maintain the material in confidence;
                (B) the materials are to be used for purposes of
            investigating, or engaging in enforcement proceedings
            related to, possible violations of--
                        (i) foreign laws prohibiting fraudulent or
                    deceptive commercial practices or other
                    practices substantially similar to practices
                    prohibited by any law administered by the
                    Commission;
                        (ii) a law administered by the Commission,
                    if disclosure of the material would further a
                    Commission investigation or enforcement
                    proceeding; or
                        (iii) with the approval of the Attorney
                    General, other foreign criminal laws, if such
                    foreign criminal laws are offenses defined in
                    or covered by a criminal mutual legal
                    assistance treaty in force between the
                    government of the United States and the foreign
                    law enforcement agency's government;
                (C) the appropriate Federal banking agency (as
            defined in section 3(q) of the Federal Deposit
            Insurance Act (12 U.S.C. 1813(q))) or, in the case of a
            Federal credit union, the National Credit Union
            Administration, has given its prior approval if the
            materials to be provided under subparagraph (B) are
            requested by the foreign law enforcement agency for the
            purpose of investigating, or engaging in enforcement
            proceedings based on, possible violations of law by a
            bank, a savings and loan institution described in
            section 18(f)(3) of the Federal Trade Commission Act
            (15 U.S.C. 57a(f)(3)), or a Federal credit union
            described in section 18(f)(4) of the Federal Trade
            Commission Act (15 U.S.C. 57a(f)(4)); and
                (D) the foreign law enforcement agency is not from
            a country that the Secretary of State has determined,
            in accordance with section 6(j) of the Export
            Administration Act of 1979 (50 U.S.C. App. 2405(j)),
            has repeatedly provided support for acts of
            international terrorism, unless and until such
            determination is rescinded pursuant to section 6(j)(4)
            of that Act (50 U.S.C. App. 2405(j)(4)).
    Nothing in the preceding sentence authorizes the disclosure of
    material obtained in connection with the administration of the
    Federal antitrust laws or foreign antitrust laws (as defined in
    paragraphs (5) and (7), respectively, of section 12 of the
    International Antitrust Enforcement Assistance Act of 1994 (15
    U.S.C. 6211)) to any officer or employee of a foreign law
    enforcement agency.

               *       *       *       *       *       *       *

        [(f) Any material which is received by the Commission in
    any investigation, a purpose of which is to determine whether
    any person may have violated any provision of the laws
    administered by the Commission, and which is provided pursuant
    to any compulsory process under this Act or which is provided
    voluntarily in place of such compulsory process shall be exempt
    from disclosure under section 552 of title 5, United States
    Code.]
        (f) Exemption From Public Disclosure.--
                (1) In general.--Any material which is received by
            the Commission in any investigation, a purpose of which
            is to determine whether any person may have violated
            any provision of the laws administered by the
            Commission, and which is provided pursuant to any
            compulsory process under this Act or which is provided
            voluntarily in place of such compulsory process shall
            not be required to be disclosed under section 552 of
            title 5, United States Code, or any other provision of
            law, except as provided in paragraph (2)(B) of this
            section.
                (2) Material obtained from a foreign source.--
                        (A) Except as provided in subparagraph (B)
                    of this paragraph, the Commission shall not be
                    required to disclose under section 552 of title
                    5, United States Code, or any other provision
                    of law--
                                (i) any material obtained from a
                            foreign law enforcement agency or other
                            foreign government agency, if the
                            foreign law enforcement agency or other
                            foreign government agency has requested
                            confidential treatment, or has
                            precluded such disclosure under other
                            use limitations, as a condition of
                            providing the material;
                                (ii) any material reflecting a
                            consumer complaint obtained from any
                            other foreign source, if that foreign
                            source supplying the material has
                            requested confidential treatment as a
                            condition of providing the material; or
                                (iii) any material reflecting a
                            consumer complaint submitted to a
                            Commission reporting mechanism
                            sponsored in part by foreign law
                            enforcement agencies or other foreign
                            government agencies.
                        (B) Nothing in this subsection shall
                    authorize the Commission to withhold
                    information from the Congress or prevent the
                    Commission from complying with an order of a
                    court of the United States in an action
                    commenced by the United States or the
                    Commission.

    SEC. 21A. CONFIDENTIALITY AND DELAYED NOTICE OF COMPULSORY PROCESS FOR
                        CERTAIN THIRD PARTIES.

        (a) Application With Other Laws.--The Right to Financial
    Privacy Act (12 U.S.C. 3401 et seq.) and chapter 121 of title
    18, United States Code, shall apply with respect to the
    Commission, except as otherwise provided in this section.
        (b) Procedures for Delay of Notification or Prohibition of
    Disclosure.--The procedures for delay of notification or
    prohibition of disclosure under the Right to Financial Privacy
    Act (12 U.S.C. 3401 et seq.) and chapter 121 of title 18,
    United States Code, including procedures for extensions of such
    delays or prohibitions, shall be available to the Commission,
    provided that, notwithstanding any provision therein--
                (1) a court may issue an order delaying
            notification or prohibiting disclosure (including
            extending such an order) in accordance with the
            procedures of section 1109 of the Right to Financial
            Privacy Act (12 U.S.C. 3409) (if notification would
            otherwise be required under that Act), or section 2705
            of title 18, United States Code, (if notification would
            otherwise be required under chapter 121 of that title),
            if the presiding judge or magistrate judge finds that
            there is reason to believe that such notification or
            disclosure may cause an adverse result, as defined in
            subsection (g); and
                (2) if notification would otherwise be required
            under chapter 121 of title 18, United States Code, the
            Commission may delay notification (including extending
            such a delay) upon the execution of a written
            certification in accordance with the procedures of
            section 2705 of that title if the Commission finds that
            there is reason to believe that notification may cause
            an adverse result, as defined in subsection (g).
        (c) Ex Parte Application by Commission.--
                (1) In general.--If neither notification nor
            delayed notification by the Commission is required
            under the Right to Financial Privacy Act (12 U.S.C.
            3401 et seq.) or chapter 121 of title 18, United States
            Code, the Commission may apply ex parte to a presiding
            judge or magistrate judge for an order prohibiting the
            recipient of compulsory process issued by the
            Commission from disclosing to any other person the
            existence of the process, notwithstanding any law or
            regulation of the United States, or under the
            constitution, or any law or regulation, of any State,
            political subdivision of a State, territory of the
            United States, or the District of Columbia. The
            presiding judge or magistrate judge may enter such an
            order granting the requested prohibition of disclosure
            for a period not to exceed 60 days if there is reason
            to believe that disclosure may cause an adverse result,
            as defined in subsection (g). The presiding judge or
            magistrate judge may grant extensions of this order of
            up to 30 days each in accordance with this subsection,
            except that in no event shall the prohibition continue
            in force for more than a total of 9 months.
                (2) Application.--This subsection shall apply only
            in connection with compulsory process issued by the
            Commission where the recipient of such process is not a
            subject of the investigation or proceeding at the time
            such process is issued.
                (3) Limitation.--No order issued under this
            subsection shall prohibit any recipient from disclosing
            to a Federal agency that the recipient has received
            compulsory process from the Commission.
        (d) No Liability for Failure to Notify.--If neither
    notification nor delayed notification by the Commission is
    required under the Right to Financial Privacy Act (12 U.S.C.
    3401 et seq.) or chapter 121 of title 18, United States Code,
    the recipient of compulsory process issued by the Commission
    under this Act shall not be liable under any law or regulation
    of the United States, or under the constitution, or any law or
    regulation, of any State, political subdivision of a State,
    territory of the United States, or the District of Columbia, or
    under any contract or other legally enforceable agreement, for
    failure to provide notice to any person that such process has
    been issued or that the recipient has provided information in
    response to such process. The preceding sentence does not
    exempt any recipient from liability for--
                (1) the underlying conduct reported;
                (2) a failure to comply with the record retention
            requirements under section 1104(c) of the Right to
            Financial Privacy Act (12 U.S.C. 3404), where
            applicable; or
                (3) any failure to comply with any obligation the
            recipient may have to disclose to a Federal agency that
            the recipient has received compulsory process from the
            Commission or intends to provide or has provided
            information to the Commission in response to such
            process.
        (e) Venue and Procedure.--
                (1) In general.--All judicial proceedings initiated
            by the Commission under the Right to Financial Privacy
            Act (12 U.S.C. 3401 et seq.), chapter 121 of title 18,
            United States Code, or this section may be brought in
            the United States District Court for the District of
            Columbia or any other appropriate United States
            District Court. All ex parte applications by the
            Commission under this section related to a single
            investigation may be brought in a single proceeding.
                (2) In camera proceedings.--Upon application by the
            Commission, all judicial proceedings pursuant to this
            section shall be held in camera and the records thereof
            sealed until expiration of the period of delay or such
            other date as the presiding judge or magistrate judge
            may permit.
        (f) Section not to Apply to Antitrust Investigations or
    Proceedings.--This section shall not apply to an investigation
    or proceeding related to the administration of Federal
    antitrust laws or foreign antitrust laws as defined in
    paragraphs (5) and (7), respectively, of section 12 of the
    International Antitrust Enforcement Assistance Act of 1994 (15
    U.S.C. 6211).
        (g) Adverse Result Defined.--For purposes of this section
    the term ``adverse result'' means--
                (1) endangering the life or physical safety of an
            individual;
                (2) flight from prosecution;
                (3) the destruction of, or tampering with,
            evidence;
                (4) the intimidation of potential witnesses; or
                (5) otherwise seriously jeopardizing an
            investigation or proceeding related to fraudulent or
            deceptive commercial practices or persons involved in
            such practices, or unduly delaying a trial related to
            such practices or persons involved in such practices,
            including, but not limited to, by--
                        (A) the transfer outside the territorial
                    limits of the United States of assets or
                    records related to fraudulent or deceptive
                    commercial practices or related to persons
                    involved in such practices;
                        (B) impeding the ability of the Commission
                    to identify persons involved in fraudulent or
                    deceptive commercial practices, or to trace the
                    source or disposition of funds related to such
                    practices; or
                        (C) the dissipation, fraudulent transfer,
                    or concealment of assets subject to recovery by
                    the Commission.

    SEC. 21B. PROTECTION FOR VOLUNTARY PROVISION OF INFORMATION.

        (a) In General.--
                (1) No liability for providing certain material.--
            An entity described in paragraphs (2) or (3) of
            subsection (d) that voluntarily provides material to
            the Commission that such entity reasonably believes is
            relevant to--
                        (A) a possible unfair or deceptive act or
                    practice, as defined in section 5(a) of this
                    Act; or
                        (B) assets subject to recovery by the
                    Commission, including assets located in foreign
                    jurisdictions;
            shall not be liable to any person under any law or
            regulation of the United States, or under the
            constitution, or any law or regulation, of any State,
            political subdivision of a State, territory of the
            United States, or the District of Columbia, for such
            provision of material or for any failure to provide
            notice of such provision of material or of intention to
            provide material.
                (2) Limitations.--Nothing in this subsection shall
            be construed to exempt any such entity from liability--
                        (A) for the underlying conduct reported; or
                        (B) to any Federal agency for providing
                    such material or for any failure to comply with
                    any obligation the entity may have to notify a
                    Federal agency prior to providing such material
                    to the Commission.
        (b) Certain Financial Institutions.--An entity described in
    paragraph (1) of subsection (d) shall, in accordance with
    section 5318(g)(3) of title 31, United States Code, be exempt
    from liability for making a voluntary disclosure to the
    Commission of any possible violation of law or regulation,
    including--
                (1) a disclosure regarding assets, including assets
            located in foreign jurisdictions--
                        (A) related to possibly fraudulent or
                    deceptive commercial practices;
                        (B) related to persons involved in such
                    practices; or
                        (C) otherwise subject to recovery by the
                    Commission; or
                (2) a disclosure regarding suspicious chargeback
            rates related to possibly fraudulent or deceptive
            commercial practices.
        (c) Consumer Complaints.--Any entity described in
    subsection (d) that voluntarily provides consumer complaints
    sent to it, or information contained therein, to the Commission
    shall not be liable to any person under any law or regulation
    of the United States, or under the constitution, or any law or
    regulation, of any State, political subdivision of a State,
    territory of the United States, or the District of Columbia,
    for such provision of material or for any failure to provide
    notice of such provision of material or of intention to so
    provide material. This subsection shall not provide any
    exemption from liability for the underlying conduct.
        (d) Application.--This section applies to the following
    entities, whether foreign or domestic:
                (1) A financial institution as defined in section
            5312 of title 31, United States Code.
                (2) To the extent not included in paragraph (1) a
            bank or thrift institution, a commercial bank or trust
            company, an investment company, a credit card issuer,
            an operator of a credit card system, and an issuer,
            redeemer, or cashier of travelers' checks, money
            orders, or similar instruments.
                (3) A courier service, a commercial mail receiving
            agency, an industry membership organization, a payment
            system provider, a consumer reporting agency, a domain
            name registrar or registry acting as such, and a
            provider of alternative dispute resolution services.
                (4) An Internet service provider or provider of
            telephone services.

               *       *       *       *       *       *       *

    SEC. 25A. STAFF EXCHANGES.

        (a) In General.--The Commission may--
                (1) retain or employ officers or employees of
            foreign government agencies on a temporary basis as
            employees of the Commission pursuant to section 2 of
            this Act, or section 3101 or section 3109 of title 5,
            United States Code; and
                (2) detail officers or employees of the Commission
            to work on a temporary basis for appropriate foreign
            government agencies.
        (b) Reciprocity and Reimbursement.--The staff arrangements
    described in subsections (a) need not be reciprocal. The
    Commission may accept payment or reimbursement, in cash or in
    kind, from a foreign government agency to which this section is
    applicable, or payment or reimbursement made on behalf of such
    agency, for expenses incurred by the Commission, its members,
    and employees in carrying out such arrangements.
        (c) Standards of Conduct.--A person appointed under
    subsection (a)(1) shall be subject to the provisions of law
    relating to ethics, conflicts of interest, corruption, and any
    other criminal or civil statute or regulation governing the
    standards of conduct for Federal employees that are applicable
    to the type of appointment.

               *       *       *       *       *       *       *

                                  ----------

           SECTION 1112 OF THE RIGHT TO FINANCIAL PRIVACY ACT OF 1978

                               USE OF INFORMATION

          Sec. 1112. (a) * * *

               *       *       *       *       *       *       *

          (e) Notwithstanding section 1101(6) or any other
    provision of law, the exchange of financial records,
    examination reports or other information with respect to a
    financial institution, holding company, or a subsidiary of a
    depository institution or holding company, among and between
    the five member supervisory agencies of the Federal Financial
    Institutions Examination Council, the Securities and Exchange
    Commission, the Federal Trade Commission, and the Commodity
    Futures Trading Commission is permitted.

               *       *       *       *       *       *       *

                         Committee Jurisdiction Letter

                               Markup Transcript

                                BUSINESS MEETING

                          THURSDAY, SEPTEMBER 30, 2004

                      House of Representatives,
                                    Committee on the Judiciary,
                                                        Washington, DC.
        The Committee met, pursuant to notice, at 10:05 a.m., in
    Room 2141, Rayburn House Office Building, Hon. F. James
    Sensenbrenner, Jr. [Chairman of the Committee] presiding.
        [Intervening business.]
        Chairman Sensenbrenner. Pursuant to notice, I now call up
    the bill, H.R. 3143, the ``International Consumer Protection
    Act of 2003'' for purposes of markup and move its favorable
    recommendation to the House. Without objection, the bill will
    be considered as read and open for amendment at any point, and
    the Chair recognizes himself for 5 minutes to explain the bill.
    I urge my colleagues to join me in favorably reporting this
    bill with the amendment in the nature of a substitute that I
    will offer.
        The legislation provides advanced powers to the Federal
    Trade Commission that will improve cooperation and information
    sharing with foreign counterparts, provide additional
    investigative and enforcement tools and ultimately better
    protect American consumers. The bill was ordered reported by
    the Energy and Commerce Committee last year and subsequently
    sequentially referred to us. There have been interagency
    negotiations on this legislation, and the product of these
    negotiations is in the amendment in the nature of a substitute
    that I will offer.
        I ask unanimous consent that my complete statement be put
    in the record at this point and am happy to yield to one of the
    minority party Members should they wish to say anything.
    Gentleman from Virginia.
        [The prepared statement of Mr. Sensenbrenner follows:]
      Prepared Statement of the Honorable F. James Sensenbrenner, Jr., a
     Representative in Congress From the State of Wisconsin, and Chairman,
                           Committee on the Judiciary
        I urge my colleagues to join me in favorably reporting the bill
    H.R. 3143 with an amendment in the nature of a substitute that I will
    offer. This legislation provides enhanced powers to the Federal Trade
    Commission that will improve cooperation and information sharing with
    foreign counterparts, provide additional investigative and enforcement
    tools, and ultimately better protect American consumers.
        H.R. 3143 was the bill ordered reported by the Committee on Energy
    & Commerce last year and sequentially referred to the Committee on the
    Judiciary. However, months of interagency negotiations between the
    Department of Justice, the FTC, the State Department and OMB produced
    modifications that have been introduced as a new consensus bill, H.R.
    4996.
        H.R. 4996 is a notable improvement that addresses concerns raised
    about the original bill by the other executive branch agencies and by
    outside parties during Congressional hearings. I understand that H.R.
    4996 is now the working text of legislation that could come to the
    House floor, and it matches companion legislation in the Senate.
    Furthermore, I understand that there are no plans to advance the older
    version, H.R. 3143 any further, but the Committee on Energy & Commerce
    will instead discharge H.R. 4996. Therefore, I will be offering an
    amendment in the nature of a substitute that replaces the text of H.R.
    3143 with the text of H.R. 4996.
        The advent of the Internet, improved telecommunications, and the
    globalization of the economy have created incredible opportunities by
    shrinking distances and blurring traditional boundaries and barriers.
    However, some of the international opportunities being created today
    are not for entrepreneurs and consumers, but for criminals who seek to
    deceive and defraud.
        What might be called ``Cross-border fraud'' is a burgeoning problem
    involving those who establish operations in one country, and use
    communications that may cross multiple national borders to deceive or
    defraud consumers in other countries.
        The FTC reports an increasing number of cases brought by the
    Commission involve foreign consumers, foreign businesses or
    individuals, or assets or evidence located outside the United States.
    In 2002, 14% of the complaints in the Consumer Sentinel database
    (excluding identity theft complaints) were cross-border complaints, up
    from 11% in 2000.
        Increasingly, the FTC's fraud-related cases have some cross-border
    component. For instance a typical spam related case may involve a
    foreign sender or an email message that crosses several national
    boundaries en route to its destination. To better enforce existing
    fraud and consumer protection laws--like CAN-SPAM--and meet the
    enforcement expectations of Congress, the FTC believes better
    international cooperation and additional tools are critical.
        The additional authority provided to the FTC in this legislation
    mirrors the existing authority given to the Securities and Exchange
    Commission.
        Concerns have been raised throughout the process of crafting the
    International Consumer Protection Act about the scope of the powers
    sought, the FTC's need for them, and the existence of adequate due
    process and privacy safeguards.
        I believe the version before us today is much improved and the FTC
    has addressed many of these concerns. Therefore, I support advancing
    the bill from Judiciary Committee at this time. However, Congress and
    the Executive branch should closely monitor the Commission's use of
    these new powers and the level of cooperation they receive from their
    foreign counterparts--and most importantly monitor for any abuses of
    information shared about U.S. entities or persons with foreign consumer
    protection authorities.
        The reporting requirements of this legislation are serious, and the
    FTC is on notice that these new authorities can easily be revoked if
    they are not used properly or if Congress does not receive adequate
    information.
        With that cautionary note, I urge my colleagues to favorably report
    the bill with the substitute amendment and help protect American
    consumers from cross-border fraud and deceptive practices.

        Mr. Scott. Mr. Chairman, I am not familiar with this bill.
    It apparently went through the Energy and Commerce Committee,
    and there appear to be some--they appear to approve the bill,
    but I am just getting information that there is some opposition
    and I am not exactly clairvoyant about what the opposition is.
    So I just wanted to express that this apparently is not
    noncontroversial, and I yield back.
        [Letter from the American Civil Liberties Union submitted
    by Mr. Scott.]

        Chairman Sensenbrenner. Without objection, all Members'
    opening statements will appear in the record at this point.
        Are there amendments? And I have an amendment in the nature
    of a substitute at the desk which the Clerk will report.
        The Clerk. Amendment in the nature of a substitute to H.R.
    3143 as reported, offered by Mr. Sensenbrenner of Wisconsin.
    Strike all after the enacting clause and insert the following.
        [The amendment in the nature of a substitute follows:]

        Chairman Sensenbrenner. Without objection, the amendment is
    considered as read and the Chair recognizes himself for 5
    minutes.
        As previously noted in my opening statement, this amendment
    in the nature of a substitute reflects an interagency consensus
    emanating from negotiations between the Justice Department, the
    FTC, the State Department, and the OMB, and I urge Members to
    support its adoption and yield back the balance of my time.
        Are there any second degree amendments to the amendment in
    the nature of a substitute? If there are none, the question is
    on agreeing to the amendment in the nature of a substitute
    offered by the Chair. Those in favor will say aye. Opposed, no.
    The ayes appear to have it. The ayes have it, and the amendment
    in the nature of a substitute is agreed to.
        A reporting quorum is not present. Without objection, the
    previous question is ordered on favorably reporting the bill to
    the House.
        [Intervening business.]
        Chairman Sensenbrenner. The unfinished business is the
    motion to report favorably the bill, H.R. 3143, as amended. A
    reporting quorum is present. All those in favor of reporting
    the bill favorably as amended will say aye. Opposed, no. The
    ayes appear to have it. The ayes have it. The motion to report
    favorably is agreed to.
        Without objection, the bill will be reported favorably to
    the House in the form of a single amendment in the nature of a
    substitute, incorporating the amendments adopted here today.
    Without objection, the Chairman is authorized to move to go to
    conference pursuant to House rules. Without objection, the
    staff is directed to make any technical and conforming changes,
    and all Members will be given 2 days as provided by House rules
    in which to submit additional, dissenting, supplemental, or
    minority views.