[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.

                                 
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