[Senate Report 108-127]
[From the U.S. Government Publishing Office]



108th Congress                                                   Report
                                 SENATE
 1st Session                                                    108-127

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

                                     

                                                       Calendar No. 251

        THE FEDERAL TRADE COMMISSION REAUTHORIZATION ACT OF 2003

                               __________

                              R E P O R T

                                 OF THE

           COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                                   on

                                S. 1234




                August 26, 2003.--Ordered to be printed

     Filed, under authority of the order of the Senate of July 29 
                    (legislative day, July 21), 2003

       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
                      one hundred eighth congress
                             first session

                     JOHN McCAIN, Arizona, Chairman
TED STEVENS, Alaska                  ERNEST F. HOLLINGS, South Carolina
CONRAD BURNS, Montana                DANIEL K. INOUYE, Hawaii
TRENT LOTT, Mississippi              JOHN D. ROCKEFELLER IV, West 
KAY BAILEY HUTCHISON, Texas              Virginia
OLYMPIA J. SNOWE, Maine              JOHN F. KERRY, Massachusetts
SAM BROWNBACK, Kansas                JOHN B. BREAUX, Louisiana
GORDON SMITH, Oregon                 BYRON L. DORGAN, North Dakota
PETER G. FITZGERALD, Illinois        RON WYDEN, Oregon
JOHN ENSIGN, Nevada                  BARBARA BOXER, California
GEORGE ALLEN, Virginia               BILL NELSON, Florida
JOHN E. SUNUNU, New Hampshire        MARIA CANTWELL, Washington
                                     FRANK LAUTENBERG, New Jersey
           Jeanne Bumpus, Staff Director and General Counsel
                   Ann Begeman, Deputy Staff Director
                  Robert W. Chamberlin, Chief Counsel
      Kevin D. Kayes, Democratic Staff Director and Chief Counsel
                Gregg Elias, Democratic General Counsel


                                                       Calendar No. 251
108th Congress                                                   Report
                                 SENATE
 1st Session                                                    108-127

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



 
        THE FEDERAL TRADE COMMISSION REAUTHORIZATION ACT OF 2003

                                _______
                                

                August 26, 2003.--Ordered to be printed

     Filed, under authority of the order of the Senate of July 29 
                    (legislative day, July 21), 2003

                                _______
                                

       Mr. McCain, from the Committee on Commerce, Science, and 
                Transportation, submitted the following

                              R E P O R T

                         [To accompany S. 1234]

    The Committee on Commerce, Science, and Transportation, to 
which was referred the bill (S. 1234) ``a bill to reauthorize 
the Federal Trade Commission, and for other purposes'', having 
considered the same, reports favorably thereon with an 
amendment in the nature of a substitute and recommends that the 
bill as amended do pass.

                          Purpose of the Bill

  S. 1234 would amend the Federal Trade Commission Act (FTCA) 
(15 U.S.C. 41 et seq.) to carry out the functions, powers, and 
duties of the Federal Trade Commission (FTC or Commission). The 
bill would authorize funding levels to be appropriated for 
fiscal years 2004 through 2007, as well as authorize the FTC to 
accept both reimbursement from other agencies that may seek the 
Commission's assistance, and gifts that do not create a 
conflict of interest. The bill also would improve the 
Commission's ability to provide more timely and effective 
international consumer protection.

                          Background and Needs

  The FTC is an independent Federal agency established by 
statute in 1914 to protect American consumers. The Commission's 
mandate has two distinct provisions: first, to protect 
consumers from unfair or deceptive acts or practices in or 
affecting commerce, and second, to protect consumers from 
unfair methods of competition. The agency enforces 46 statutes 
and is the only Federal agency with both consumer protection 
and competition jurisdiction in broad sectors of the economy.
  The Commission is comprised of five members appointed for 
seven-year terms by the President, with the advice and consent 
of the Senate. Under the FTCA, no more than three commissioners 
may be from the same political party. Currently, the Commission 
is comprised of three Republican commissioners, Chairman 
Timothy Muris, and Commissioners Orson Swindle and Thomas 
Leary; and two Democratic commissioners, Sheila Anthony and 
Mozelle Thompson.
  The FTC employs approximately 1074 full-time employees 
located in Washington, D.C., and throughout seven regional 
offices located in Seattle, San Francisco, Los Angeles, Dallas, 
Chicago, Atlanta, and New York. The Commission is divided into 
three bureaus: Consumer Protection (BCP), Competition (BC), and 
Economics (BE). The directors of each bureau are appointed by 
the Chairman of the FTC and report directly to him/her. The FTC 
also has an Office of Public Affairs; Office of Congressional 
Relations; Office of the General Counsel; Office of the 
Secretary; Executive Director; Consumer and Business Education 
Office; and Office of Policy and Planning.
  The FTC has been unauthorized since 1998 (P.L. 104-216). S. 
1234 would authorize funding for the Commission for fiscal 
years 2004 through 2007. The bill also would allow the FTC to 
accept reimbursement for services undertaken on behalf of any 
domestic or foreign law enforcement agency. FTC staff members 
occasionally provide investigative or other services to a 
requesting law enforcement agency with no expectation that the 
Commission will be reimbursed for any expenses incurred. The 
FTC also may work in conjunction with staff of other law 
enforcement agencies to investigate or prosecute a matter. 
Thus, the Commission has requested authority to accept 
reimbursement if offered. Such authority would be useful in 
instances where expense-sharing arrangements have not been 
resolved in advance. The Securities Exchange Act of 1934 
provides similar authority to the Securities and Exchange 
Commission.
  The bill also would authorize the FTC to accept gifts and 
services under certain circumstances. Occasionally, the 
Commission is offered gifts, donations, bequests, and volunteer 
services, but such receipt is prohibited by law. For example, 
volunteer services are prohibited, as is the acceptance of even 
a trade regulation publication that might be useful in the 
Commission's library. In order to legally accept such gifts or 
other items, the Commission would need to receive statutory 
authority. The Federal Communications Commission (FCC) and the 
Consumer Product Safety Commission (CPSC) have similar 
authority to accept gifts and services.
  As part of the FTC's reauthorization, the Commission has 
proposed legislative changes to the FTCA seeking authorization 
to expand its authority under section 5 of the FTCA to protect 
consumers from fraudulent and deceptive trade practices 
perpetrated abroad. This request was not part of the 
reauthorization bill that was reported by the Commerce 
Committee in 2002.
  The FTC argues that cross-border consumer complaints 
registered in the Commission's computer database (i.e., the 
Consumer Sentinel consumer complaint database) have risen from 
11 percent of all complaints received in 2000, to 14 percent in 
2002. The Commission attributes this increase primarily to the 
global proliferation of the Internet and improvements in 
telecommunications technologies. According to the FTC, the 
Commission's existing legal framework poses challenges in 
combating this cross-border activity.\1\
---------------------------------------------------------------------------
    \1\ See Memorandum from FTC to United States Senate Committee on 
Commerce, Science, and Transportation, dated April 23, 2003--in which 
the FTC states: ``We think it is [  ] critical to address [statutory] 
challenges promptly with certain legislative amendments, especially in 
the areas of information sharing, mutual assistance, and joint action. 
Our ability to share more information would help foreign enforcers in 
their investigations that benefit United States consumers. Providing 
assistance where foreign consumers are victimized by United States 
businesses helps to protect the integrity of our markets, and also 
encourages reciprocity from our foreign counterparts. The approach to 
mutual assistance needed now for consumer protection enforcement is 
similar to that already developed for anti-trust, securities, commodity 
futures, and other enforcement areas.''
---------------------------------------------------------------------------
  According to the FTC, the Commission's cross-border fraud 
language, which is contained in S. 1234, is the product of 
negotiations between the FTC and various other governmental 
entities including, among others, the Department of Justice 
(DOJ), the Department of State, the Federal Deposit Insurance 
Corporation (FDIC), and the Federal Reserve, that took place to 
properly define the scope of the FTC's jurisdiction vis-a-vis 
the functions of those agencies.

                         Summary of Provisions

  S. 1234 would amend the FTCA to authorize the FTC to: (1) 
receive specified levels of funding to be appropriated for 
fiscal years 2004 through 2007; (2) provide investigative and 
other services to a requesting law enforcement agency and 
accept payment of reimbursement from that agency for the 
Commission's involvement; (3) receive gifts or other items that 
would be useful to the Commission as long as a conflict of 
interest is not created by such receipt; (4) share information 
involving cross-border fraud with foreign consumer protection 
agencies; (5) secure confidential information from those 
foreign consumer protection agencies; (6) take fraud-based 
legal action in foreign jurisdictions; (7) seek redress on 
behalf of foreign consumers victimized by United States-based 
wrongdoers; (8) make criminal referrals for cross-border 
criminal activity; and (9) strengthen its relationship with 
foreign consumer protection agencies.

                          Legislative History

  The FTC was last reauthorized in 1996 when funding was 
authorized for fiscal years 1997 and 1998. Prior to the 1996 
reauthorization, the Commission remained unauthorized from 1982 
to 1994 due largely to concerns over the application of the 
``unfairness doctrine'' to advertising cases. The Commission 
had undertaken a rulemaking process with respect to children's 
advertising and, according to some, was attempting to use the 
``unfairness'' standard too broadly. That resulted in the 
enactment of the 1980 FTC Improvements Act, which imposed a 
moratorium on ``unfairness'' rulemakings through fiscal year 
(FY) 1982.
  During the 103rd Congress, a reauthorization bill was 
reported by the Senate Committee on Commerce, Science, and 
Transportation (the Committee) after members agreed to limit 
the Commission's potential for broad rulemaking with respect to 
``unfairness'' interpretations. The legislation (P.L. 103-312) 
amended section 5 of the FTCA by defining an act or practice as 
unfair only if ``the act or practice causes or is likely to 
cause substantial injury to consumers which is not reasonably 
avoidable by consumers themselves and not outweighed by 
countervailing benefits to consumers or competition''.\2\
---------------------------------------------------------------------------
    \2\ See 15 U.S.C. 45.
---------------------------------------------------------------------------
  During the 106th Congress, the Senate proposed a bill to 
reauthorize the FTC (S. 1687), and the Subcommittee on Consumer 
Affairs held a hearing in February 2000. The Committee reported 
the bill to the full Senate, and the bill was passed with 
amendments. However, the House failed to act on the 
legislation. The Senate bill included, among other things, 
provisions for amending the merger review process under the 
Hart-Scott-Rodino Act. These provisions were later passed as 
part of the Commerce-Justice-State Appropriations Act for FY 
2001.
  During the 107th Congress, the Consumer Affairs Subcommittee 
held an oversight hearing on the FTC on July 17, 2002, at which 
the full Commission and consumer and industry representatives 
testified. Subsequent to the subcommittee hearing, Chairman 
Hollings and Senator Dorgan introduced the Federal Trade 
Commission Reauthorization Act of 2002 (S. 2946). The Committee 
considered S. 2946 during an executive session on September 19, 
2002, and reported the measure by a vote of 16 to seven. This 
bill was placed on the Senate legislative calendar on November 
19, 2002, but the Senate did not consider the bill before the 
end of the Congress.
  During the 108th Congress, the Competition, Foreign Commerce, 
and Infrastructure Subcommittee held a hearing on June 11, 
2003, to examine possible changes to the FTCA and discuss key 
issues before the FTC. The following witnesses appeared before 
the Subcommittee at the hearing: FTC Chairman Timothy Muris; 
FTC Commissioners Thompson, Swindle, and Leary; Lawrence 
Sarjeant, Vice President of Law at the United States Telecom 
Association (USTA); Sarah Deutsch, Vice President and Associate 
General Counsel at Verizon Communications; Susan Grant, 
Director of the National Fraud Information/Internet Fraud Watch 
for the National Consumers League; Scott Cooper, Manager of 
Technology Policy for Hewlett-Packard; Marc Rotenberg, 
Executive Director of the Electronic Privacy Information Center 
(EPIC); and Ari Schwartz, Associate Director for the Center for 
Democracy and Technology. On June 10, 2003, Senators McCain and 
Smith introduced S. 1234, the Federal Trade Commission 
Reauthorization Act of 2003.
  On June 19, 2003, the Committee met in open executive session 
to consider an amendment in the nature of a substitute to S. 
1234 offered by Senators McCain and Smith. The Committee agreed 
to incorporate in the substitute amendment language that was 
offered as an amendment by Senator Smith requiring the FTC to 
educate consumers concerning the possible risks associated with 
peer-to-peer file sharing technology. The substitute amendment 
was adopted, and the bill was ordered to be reported as amended 
by voice vote.

                            Estimated Costs

  In accordance with paragraph 11(a) of rule XXVI of the 
Standing Rules of the Senate and section 403 of the 
Congressional Budget Act of 1974, the Committee provides the 
following cost estimate, prepared by the Congressional Budget 
Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, July 9, 2003.
Hon. John McCain,
Chairman, Committee on Commerce, Science, and Transportation,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 1234, the Federal 
Trade Commission Reauthorization Act of 2003.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Melissa E. 
Zimmerman.
            Sincerely,
                                     Douglas Holtz-Eakin, Director.
    Enclosure.

S. 1234--Federal Trade Commission Reauthorization Act of 2003

    Summary: S. 1234 would authorize the appropriation of $900 
million for the Federal Trade Commission (FTC) over the 2004-
2007 period, including up to $100,000 a year to support 
activities of certain international law enforcement groups. 
Because S. 1234 would allow the FTC to accept and spend 
monetary gifts, CBO estimates that the bill would have a 
negligible effect on revenues and direct spending.
    Assuming appropriation of the amounts specified in S. 1234, 
CBO estimates that implementing the bill would cost $179 
million in 2004 and $900 million over the 2004-2008 period. 
Most of this spending would likely be offset, however, by fees 
authorized to be collected under current law for reviewing 
certain mergers and for administering a national ``do-not-
call'' registry. Assuming future appropriation acts allow the 
FTC to continue to collect those fees, CBO estimates that net 
FTC spending from the amounts authorized by S. 1234 would be 
$49 million in 2004 and $340 million over the 2004-2008 period.
    S. 1234 would preempt state and local laws that require 
notice to third parties when certain information relating to 
them is disclosed to the FTC. Such preemptions are 
intergovernmental mandates as defined in the Unfunded Mandates 
Reform Act (UMRA), but CBO estimates that the costs of the 
mandates would not exceed the threshold established in UMRA 
($59 million in 2003, adjusted for inflation).
    In addition, S. 1234 would exempt from liability those 
entities that provide certain information on third parties to 
the FTC. To the extent that the bill limits the ability of a 
third party to sue under current law, S. 1234 would impose a 
private-sector mandate. CBO expects the costs to the private 
sector would be minimal, falling well below the annual 
threshold for private-sector mandates established in UMRA ($117 
million in 2003, adjusted annually for inflation).
    Estimated cost to the Federal Government: The estimated 
budgetary impact of S. 1234 is shown in the following table. 
The costs of this legislation fall within budget function 370 
(commerce and housing credit).

----------------------------------------------------------------------------------------------------------------
                                                                  By fiscal year, in millions of dollars--
                                                          ------------------------------------------------------
                                                              2004       2005       2006       2007       2008
----------------------------------------------------------------------------------------------------------------
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATION
 
Gross FEC Spending From Authorizations in S. 1234:
    Authorization Level..................................        195        225        236        245          0
    Estimated Outlays \1\................................        179        222        235        244         20
Less: Offsetting Collection \2\:
    Estimated Authorization Level........................       -130       -136       -144       -150          0
    Estimated Outlays....................................       -130       -136       -144       -150          0
Net FTC Spending From Authorizations in S. 1234:
    Estimated Authorization Level........................         65         89         92         95          0
    Estimated Outlays \1\................................         49         86         91         94         20
----------------------------------------------------------------------------------------------------------------
\1\ In addition to the sums shown in the table, outlays for fiscal year 2004 would also include $14 million from
  the FTC's 2003 appropriation.
\2\ The FTC is authorized to collect fees that outset the agency's annual appropriations. The amount collected
  is not dependent on the amount appropriated.

    Basis of estimate: S. 1234 would authorize the 
appropriation of $900 million for the FTC over the 2004-2007 
period, starting at $195 million for 2004 and growing to $245 
million for 2007. (The appropriation for 2003 is $177 million.) 
Based on the agency's historical spending patterns, CBO 
estimates that outlays from such appropriations would total 
$179 million in 2004 and $900 million over the 2004-2008 
period.
    The gross spending of the FTC is typically offset by fees 
the agency collects for reviewing mergers and for administering 
the national ``do-not-call'' registry. The amount collected is 
not dependent on the amount appropriated to the FTC. CBO 
estimates that collections from those fees would total $560 
million over the 2004-2007 period, assuming that future 
appropriation acts continue to authorize the agency to collect 
such fees. If the FTC collects those amounts, we estimate that 
net FTC spending from the amounts authorized by S. 1234 would 
be $49 million in 2004 and $340 million over the 2004-2008 
period.
    Intergovernmental and private-sector impact: Title II 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 any one 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 title 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 
an interested third party.
    To the extent that state and local governments have laws 
that contradict those provisions in title II, the legislation 
would preempt those laws and thereby impose intergovernmental 
mandates under UMRA. CBO estimates that the cost of those 
mandates would be minimal and would not exceed the threshold 
established in UMRA ($59 million in 2003, adjusted for 
inflation).
    In addition, by exempting from liability entities that 
provide information about third parties to the FTC, S. 1234 
would limit the ability of the third parties to sue for the 
disclosure or for failure to provide notice of disclosure. Such 
a limitation would constitute a private-sector mandate under 
UMRA. According to the FTC, few third-party lawsuits are filed 
because entities do not voluntarily provide information to the 
FTC due to their potential exposure to liability. Therefore, 
CBO expects minimal costs would accrue to the private sector as 
a result of the mandate.
    Estimate prepared by: Federal Costs: Melissa E. Zimmerman; 
Impact on State, Local, and Tribal Governments: Victoria Heid 
Hall; Impact on the Private Sector: Lauren Marks.
    Estimate approved by: Robert A. Sunshine, Assistant 
Director for Budget Analysis.

                      Regulatory Impact Statement

  In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following evaluation of the regulatory impact of the 
legislation, as reported:

                       NUMBER OF PERSONS COVERED

  There is no significant change in the number of persons 
covered under the legislation.

                            ECONOMIC IMPACT

  The economic impact of this legislation would be minimal.

                                PRIVACY

  The impact on the personal privacy of the persons covered by 
this legislation is expected to be minimal.

                               PAPERWORK

  The impact on paperwork is difficult to determine prior to 
enactment.

                      Section-by-Section Analysis


                        TITLE I--REAUTHORIZATION

Section 101. Reauthorization

  This section would amend section 25 of the FTCA to authorize 
appropriations to carry out the functions, powers, and duties 
of the FTC not to exceed $194,742,000 for FY 2004, $224,695,000 
for FY 2005, $235,457,000 for FY 2006, and $245,000,000 for FY 
2007.

Section 102. Authority to Accept Reimbursements, Gifts, and Voluntary 
        and Uncompensated Services

  This section would amend sections 26 and 27 of the FTCA to 
authorize the FTC to accept reimbursement from other agencies 
for assistance provided in investigations or otherwise, and 
accept gifts that do not create a conflict of interest, 
respectively.

Section 103. Peer-To-Peer File Sharing Risk Education

  This section would require the FTC, as part of its existing 
consumer education programs, to educate consumers concerning 
the potential risks to their privacy and personal security, as 
well as to educate consumers about potentially inappropriate 
behavior resulting from purposeful or accidental misuse of 
peer-to-peer file sharing technology.

              TITLE II--INTERNATIONAL CONSUMER PROTECTION

Section 201. Findings

  This section describes Congress's findings that cross-border 
fraud is a growing international problem that affects American 
consumers and businesses. The proliferation of Internet and 
telecommunications technologies has accentuated the problem of 
such fraud. Increasingly, foreign consumers are affected. The 
Commission's ability to obtain effective consumer fraud relief 
is impeded by its limited authority. Improving the Commission's 
ability to share information with its foreign counterparts is 
expected to allow for more timely and effective consumer fraud 
relief.

Section 202. Foreign Law Enforcement Agency Defined

  This section would amend section 4 of the FTCA to include the 
definition of ``foreign law enforcement agency.''

Section 203. Sharing Information With Foreign Law Enforcement Agencies

  This section would amend section 21(b)(6) of the FTCA to 
authorize the FTC to share information with other agencies and 
expand existing authority to share compelled or confidential 
information with foreign law enforcers in consumer protection 
cases. Currently, information that is confidential or that has 
been compelled cannot be shared with foreign law enforcement 
agencies without the consent of the entity submitting the 
information.

Section 204. Obtaining Information for Foreign Law Enforcement Agencies

  This section would amend section 6 of the FTCA to authorize 
the FTC to conduct investigations and discovery on behalf of 
its foreign counterparts.

Section 205. Information Supplied By and About Foreign Sources

  This section would amend section 21(f) of the FTCA to 
authorize the FTC to exempt from disclosure pursuant to the 
Freedom of Information Act (5 U.S.C. 552) information received 
from foreign government agencies and consumer complaint 
information received from a non-governmental foreign source, 
if, in both instances, the person who submits information to 
the FTC requests that the information be kept confidential. The 
bill also would exempt information submitted to a reporting 
mechanism that is jointly sponsored with foreign consumer 
protection agencies (e.g., www.econsumer.gov). However, nothing 
in this section authorizes the Commission to withhold 
information from Congress or prevent it from complying with a 
court order.

Section 206. Confidentiality and Delayed Notice of Process

  This section would create a new section 21A in the FTCA to 
authorize the FTC to provide delayed notice to suspected 
perpetrators of fraud (currently entitled to such notice under 
the Right to Financial Privacy Act (RFPA) (12 U.S.C. 3401 et 
seq.)) that the FTC is requesting information about them from 
financial institutions.

Section 207. Protection for Voluntary Provision of Information

  This section would create a new section 21B in the FTCA to 
authorize the FTC to delay notice to individuals being 
investigated by allowing third parties to keep Civil 
Investigative Demands (CIDs) confidential notwithstanding 
Federal or State law. The FTC often obtains information when 
investigating fraud by issuing CIDs to third parties. This 
section also protects entities from liability under applicable 
Federal and State laws for voluntary disclosures they make to 
the FTC concerning consumer fraud, or concerning recovery of 
assets for consumer redress.

Section 208. Information Sharing With Financial Regulators

  This section would amend section 1112(e) of the RFPA to allow 
the FTC to share appropriate information with financial and 
market regulators.

Section 209. Representation in Foreign Litigation

  This section would amend section 16 of the FTCA to authorize 
the FTC to retain foreign counsel to assist the DOJ's Office of 
Foreign Litigation in pursuing cases in foreign jurisdictions.

Section 210. Availability of Remedies

  This section would amend section 5 of the FTCA to authorize 
the FTC to obtain redress from United States-based wrongdoers 
on behalf of foreign consumers based on conduct that takes 
place in the United States.

Section 211. Criminal Referrals

  This section would amend section 6 of the FTCA, as amended by 
section 204 of this title, to authorize the FTC to make 
criminal referrals when violations of FTC law also violate a 
title 18 provision, such as wire fraud, mail fraud, or 
contempt.

Section 212. Staff Exchanges

  This section would create a new section 25 of the FTCA to 
authorize the FTC to participate in foreign staff exchange 
programs, and to make and accept full or partial reimbursement 
in such exchanges.

Section 213. Expenditures for Cooperative Arrangements

  This section would amend section 6 of the FTCA, as amended by 
section 211 of this title, to authorize funds not to exceed a 
total of $100,000 annually for costs of certain joint projects 
and bilateral and multilateral meetings.

                      Rollcall Votes in Committee

  In accordance with paragraph 7(c) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following description of the record votes during its 
consideration of S. 1234:
  Senator Lautenberg offered an amendment to prohibit cigarette 
manufacturers from making claims relating to nicotine and tar 
measurement levels set by the FTC. By rollcall vote of 11 yeas 
and 12 nays, the substitute amendment was defeated.
        YEAS--11                      NAYS--12
Mr. Hollings                        Mr. Stevens
Mr. Inouye\1\                       Mr. Burns
Mr. Rockfeller                      Mr. Lott
Mr. Kerry\1\                        Mrs. Hutchison
Mr. Breaux                          Ms. Snowe\1\
Mr. Dorgan                          Mr. Brownback
Mr. Wyden                           Mr. Smith
Mrs. Boxer                          Mr. Fitzgerald\1\
Mr. Nelson                          Mr. Ensign
Ms. Cantwell                        Mr. Allen
Mr. Lautenberg                      Mr. Sununu
                                    Mr. McCain

    \1\ By proxy

                        Changes in Existing Law

  In compliance with paragraph 12 of rule XXVI of the Standing 
Rules of the Senate, 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 material is printed 
in italic, existing law in which no change is proposed is shown 
in roman):

                     Right to Financial Privacy Act

SEC. 112. USE OF INFORMATION.

                            [12 U.S.C. 3412]

  (a) Transfer of Financial Records to Other Agencies or 
Departments; Certification.--Financial records originally 
obtained pursuant to this title shall not be transferred to 
another agency or department unless the transferring agency or 
department certifies in writing that there is reason to believe 
that the records are relevant to a legitimate law enforcement 
inquiry, or intelligence or counterintelligence activity, 
investigation or analysis related to international terrorism 
within the jurisdiction of the receiving agency or department.
  (b) Mailing of Copy of Certification and Notice to 
Customer.--When financial records subject to this title are 
transferred pursuant to subsection (a), the transferring agency 
or department shall, within fourteen days, send to the customer 
a copy of the certification made pursuant to subsection (a) and 
the following notice, which shall state the nature of the law 
enforcement inquiry with reasonable specificity: ``Copies of, 
or information contained in, your financial records lawfully in 
possession of ---------- have been furnished to ---------- 
pursuant to the Right of Financial Privacy Act of 1978 for the 
following purpose: ----------. If you believe that this 
transfer has not been made to further a legitimate law 
enforcement inquiry, you may have legal rights under the 
Financial Privacy Act of 1978 or the Privacy Act of 1974.''
  (c) Court-Ordered Delays in Mailing.--Notwithstanding 
subsection (b), notice to the customer may be delayed if the 
transferring agency or department has obtained a court order 
delaying notice pursuant to section 1109(a) and (b) and that 
order is still in effect, or if the receiving agency or 
department obtains a court order authorizing a delay in notice 
pursuant to section 1109(a) and (b). Upon the expiration of any 
such period of delay, the transferring agency or department 
shall serve to the customer the notice specified in subsection 
(b) above and the agency or department that obtained the court 
order authorizing a delay in notice pursuant to section 1109(a) 
and (b) shall serve to the customer the notice specified in 
section 1109(b).
  (d) Exchanges of Examination Reports by Supervisory Agencies; 
Transfer of Financial Records to Defend Customer Action; 
Withholding of Information.--Nothing in this title prohibits 
any supervisory agency from exchanging examination reports or 
other information with another supervisory agency. Nothing in 
this title prohibits the transfer of a customer's financial 
records needed by counsel for a Government authority to defend 
an action brought by the customer. Nothing in this title shall 
authorize the withholding of information by any officer or 
employee of a supervisory agency from a duly authorized 
committee or subcommittee of the Congress.
  (e) Federal Financial Institutions Examination Council 
Supervisory Agencies; Authorization of Exchange of Financial 
Records or Other Information.--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 any 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.
  (f) Transfer to Attorney General.--
          (1) In general.--Nothing in this title shall apply 
        when financial records obtained by an agency or 
        department of the United States are disclosed or 
        transferred to the Attorney General or the Secretary of 
        the Treasury upon the certification by a supervisory 
        level official of the transferring agency or department 
        that--
                  (A) there is reason to believe that the 
                records may be relevant to a violation of 
                Federal criminal law; and
                  (B) the records were obtained in the exercise 
                of the agency's or department's supervisory or 
                regulatory functions.
          (2) Limitation on use.--Records so transferred shall 
        be used only for criminal investigative or prosecutive 
        purposes, for civil actions under section 951 of the 
        Financial Institutions Reform, Recovery, and 
        Enforcement Act of 1989, or for forfeiture under 
        sections 981 or 982 of title 18, United States Code, by 
        the Department of Justice and only for criminal 
        investigative purposes relating to money laundering and 
        other financial crimes by the Department of the 
        Treasury and shall, upon completion of the 
        investigation or prosecution (including any appeal), be 
        returned only to the transferring agency or department. 
        No agency or department so transferring such records 
        shall be deemed to have waived any privilege applicable 
        to those records under law.

                      FEDERAL TRADE COMMISSION ACT

SEC. 4. DEFINITIONS.

                             [15 U.S.C. 44]

  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--
          (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 organization, to the extent 
        that it is acting on behalf of an entity described in 
        paragraph (1).

SEC. 5. UNFAIR METHODS OF COMPETITION UNLAWFUL; PREVENTION BY 
                    COMMISSION.

                             [15 U.S.C. 45]

  (a) Declaration of Unlawfulness; Power to Prohibit Unfair 
Practices; Inapplicability to Foreign Trade.--(1) Unfair 
methods of competition in or affecting commerce, and unfair or 
deceptive acts or practices in or affecting commerce, are 
hereby declared unlawful.
  (2) The Commission is hereby empowered and directed to 
prevent persons, partnerships, or corporations, except banks, 
savings and loan institutions described in section 18(f)(3), 
Federal credit unions described in section 18(f)(4), common 
carriers subject to the Acts to regulate commerce, air carriers 
and foreign air carriers subject to the Federal Aviation Act of 
1958, and persons, partnerships, or corporations insofar as 
they are subject to the Packers and Stockyards Act, 1921, as 
amended, except as provided in section 406(b) of said Act, from 
using unfair methods of competition in or affecting commerce 
and unfair or deceptive acts or practices in or affecting 
commerce.
  (3) This subsection shall not apply to unfair methods of 
competition involving commerce with foreign nations (other than 
import commerce) unless--
          (A) such methods of competition have a direct, 
        substantial, and reasonably foreseeable effect--
                  (i) on commerce which is not commerce with 
                foreign nations, or on import commerce with 
                foreign nations; or
                  (ii) on export commerce with foreign nations, 
                of a person engaged in such commerce in the 
                United States; and
          (B) such effect gives rise to a claim under the 
        provisions of this subsection, other than this 
        paragraph.
If this subsection applies to such methods of competition only 
because of the operation of subparagraph (A)(ii), this 
subsection shall apply to such conduct only for injury to 
export business in the United States.
  (b) Proceeding by Commission; Modifying and Setting Aside 
Orders.--Whenever the Commission shall have reason to believe 
that any such person, partnership, or corporation has been or 
is using any unfair method of competition or unfair or 
deceptive act or practice in or affecting commerce, and if it 
shall appear to the Commission that a proceeding by it in 
respect thereof would be to the interest of the public, it 
shall issue and serve upon such person, partnership, or 
corporation a complaint stating its charges in that respect and 
containing a notice of a hearing upon a day and at a place 
therein fixed at least thirty days after the service of said 
complaint. The person, partnership, or corporation so 
complained of shall have the right to appear at the place and 
time so fixed and show cause why an order should not be entered 
by the Commission requiring such person, partnership, or 
corporation to cease and desist from the violation of the law 
so charged in said complaint. Any person, partnership, or 
corporation may make application, and upon good cause shown may 
be allowed by the Commission to intervene and appear in said 
proceeding by counsel or in person. The testimony in any such 
proceeding shall be reduced to writing and filed in the office 
of the Commission. If upon such hearing the Commission shall be 
of the opinion that the method of competition or the act or 
practice in question is prohibited by this Act, it shall make a 
report in writing in which it shall state its findings as to 
the facts and shall issue and cause to be served on such 
person, partnership, or corporation an order requiring such 
person, partnership, or corporation to cease and desist from 
using such method of competition or such act or practice. Until 
the expiration of the time allowed for filing a petition for 
review, if no such petition has been duly filed within such 
time, or, if a petition for review has been filed within such 
time then until the record in the proceeding has been filed in 
a court of appeals of the United States, as hereinafter 
provided, the Commission may at any time, upon such notice and 
in such manner as it shall deem proper, modify or set aside, in 
whole or in part, any report or any order made or issued by it 
under this section. After the expiration of the time allowed 
for filing a petition for review, if no such petition has been 
duly filed within such time, the Commission may at any time, 
after notice and opportunity for hearing, reopen and alter, 
modify, or set aside, in whole or in part, any report or order 
made or issued by it under this section, whenever in the 
opinion of the Commission conditions of fact or of law have so 
changed as to require such action or if the public interest 
shall so require, except that (1) the said person, partnership, 
or corporation may, within sixty days after the service upon 
him or it of said report or order entered after such a 
reopening, obtain a review thereof in the appropriate court of 
appeals of the United States, in the manner provided in 
subsection (c) of this section; and (2) in the case of an 
order, the Commission shall reopen any such order to consider 
whether such order (including any affirmative relief provision 
contained in such order) should be altered, modified, or set 
aside, in whole or in part, if the person, partnership, or 
corporation involved files a request with the Commission which 
makes a satisfactory showing that changed conditions of law or 
fact require such order to be altered, modified, or set aside, 
in whole or in part. The Commission shall determine whether to 
alter, modify, or set aside any order of the Commission in 
response to a request made by a person, partnership, or 
corporation under paragraph (2) not later than 120 days after 
the date of the filing of such request.
  (c) Review of Order; Rehearing.--Any person, partnership, or 
corporation required by an order of the Commission to cease and 
desist from using any method of competition or act or practice 
may obtain a review of such order in the court of appeals of 
the United States, within any circuit where the method of 
competition or the act or practice in question was used or 
where such person, partnership, or corporation resides or 
carries on business, by filing in the court, within sixty days 
from the date of the service of such order, a written petition 
praying that the order of the Commission be set aside. A copy 
of such petition shall be forthwith transmitted by the clerk of 
the court to the Commission, and thereupon the Commission shall 
file in the court the record in the proceeding, as provided in 
section 2112 of title 28, United States Code. Upon such filing 
of the petition the court shall have jurisdiction of the 
proceeding and of the question determined therein concurrently 
with the Commission until the filing of the record and shall 
have power to make and enter a decree affirming, modifying, or 
setting aside the order of the Commission, and enforcing the 
same to the extent that such order is affirmed and to issue 
such writs as are ancillary to its jurisdiction or are 
necessary in its judgment to prevent injury to the public or to 
competitors pendente lite. The findings of the Commission as to 
the facts, if supported by evidence, shall be conclusive. To 
the extent that the order of the Commission is affirmed, the 
court shall thereupon issue its own order commanding obedience 
to the terms of such order of the Commission. If either party 
shall apply to the court for leave to adduce additional 
evidence, and shall show to the satisfaction of the court that 
such additional evidence is material and that there were 
reasonable grounds for the failure to adduce such evidence in 
the proceeding before the Commission, the court may order such 
additional evidence to be taken before the Commission and to be 
adduced upon the hearing in such manner and upon such terms and 
conditions as to the court may seem proper. The Commission may 
modify its findings as to the facts, or make new findings, by 
reason of the additional evidence so taken, and it shall file 
such modified or new findings, which, if supported by evidence, 
shall be conclusive, and its recommendation, if any, for the 
modification or setting aside of its original order, with the 
return of such additional evidence. The judgment and decree of 
the court shall be final, except that the same shall be subject 
to review by the Supreme Court upon certiorari, as provided in 
section 240 of the Judicial Code.
  (d) Jurisdiction of Court.--Upon the filing of the record 
with it the jurisdiction of the court of appeals of the United 
States to affirm, enforce, modify, or set aside orders of the 
Commission shall be exclusive.
  (e) Extension From Liability.--No order of the Commission or 
judgment of court to enforce the same shall in anywise relieve 
or absolve any person, partnership, or corporation from any 
liability under the Antitrust Acts.
  (f) Service of Complaints, Orders and Other Processes; 
Return.--Complaints, orders, and other processes of the 
Commission under this section may be served by anyone duly 
authorized by the Commission, either (a) by delivering a copy 
thereof to the person to be served, or to a member of the 
partnership to be served, or the president, secretary, or other 
executive officer or a director of the corporation to be 
served; or (b) by leaving a copy thereof at the residence or 
the principal office or place of business of such person, 
partnership, or corporation; or (c) by mailing a copy thereof 
by registered mail or by certified mail addressed to such 
person, partnership, or corporation at his or its residence or 
principal office or place of business. The verified return by 
the person so serving said complaint, order, or other process 
setting forth the manner of said service shall be proof of the 
same, and the return post office receipt for said complaint, 
order, or other process mailed by registered mail or by 
certified mail as aforesaid shall be proof of the service of 
the same.
  (g) Finality of Order.--An order of the Commission to cease 
and desist shall become final--
          (1) Upon the expiration of the time allowed for 
        filing a petition for review, if no such petition has 
        been duly filed within such time; but the Commission 
        may thereafter modify or set aside its order to the 
        extent provided in the last sentence of subsection (b).
          (2) Except as to any order provision subject to 
        paragraph (4), upon the sixtieth day after such order 
        is served, if a petition for review has been duly 
        filed; except that any such order may be stayed, in 
        whole or in part and subject to such conditions as may 
        be appropriate, by--
                  (A) the Commission;
                  (B) an appropriate court of appeals of the 
                United States, if (i) a petition for review of 
                such order is pending in such court, and (ii) 
                an application for such a stay was previously 
                submitted to the Commission and the Commission, 
                within the 30-day period beginning on the date 
                the application was received by the Commission, 
                either denied the application or did not grant 
                or deny the application; or
                  (C) the Supreme Court, if an applicable 
                petition for certiorari is pending.
          (3) For purposes of subsection (m)(1)(B) and of 
        section 19(a)(2), if a petition for review of the order 
        of the Commission has been filed--
                  (A) upon the expiration of the time allowed 
                for filing a petition for certiorari, if the 
                order of the Commission has been affirmed or 
                the petition for review has been dismissed by 
                the court of appeals and no petition for 
                certiorari has been duly filed;
                  (B) upon the denial of a petition for 
                certiorari, if the order of the Commission has 
                been affirmed or the petition for review has 
                been dismissed by the court of appeals; or
                  (C) upon the expiration of 30 days from the 
                date of issuance of a mandate of the Supreme 
                Court directing that the order of the 
                Commission be affirmed or the petition for 
                review be dismissed.
          (4) In the case of an order provision requiring a 
        person, partnership, or corporation to divest itself of 
        stock, other share capital, or assets, if a petition 
        for review of such order of the Commission has been 
        filed--
                  (A) upon the expiration of the time allowed 
                for filing a petition for certiorari, if the 
                order of the Commission has been affirmed or 
                the petition for review has been dismissed by 
                the court of appeals and no petition for 
                certiorari has been duly filed;
                  (B) upon the denial of a petition for 
                certiorari, if the order of the Commission has 
                been affirmed or the petition for review has 
                been dismissed by the court of appeals; or
                  (C) upon the expiration of 30 days from the 
                date of issuance of a mandate of the Supreme 
                Court directing that the order of the 
                Commission be affirmed or the petition for 
                review be dismissed.
  (h) Modification or Setting Aside of Order by Supreme 
Court.--If the Supreme Court directs that the order of the 
Commission be modified or set aside, the order of the 
Commission rendered in accordance with the mandate of the 
Supreme Court shall become final upon the expiration of thirty 
days from the time it was rendered, unless within such thirty 
days either party has instituted proceedings to have such order 
corrected to accord with the mandate, in which event the order 
of the Commission shall become final when so corrected.
  (i) Modification or Setting Aside of Order by Court of 
Appeals.--If the order of the Commission is modified or set 
aside by the court of appeals, and if (1) the time allowed for 
filing a petition for certiorari has expired and no such 
petition has been duly filed, or (2) the petition for 
certiorari has been denied, or (3) the decision of the court 
has been affirmed by the Supreme Court, then the order of the 
Commission rendered in accordance with the mandate of the court 
of appeals shall become final on the expiration of thirty days 
from the time such order of the Commission was rendered, unless 
within such thirty days either party has instituted proceedings 
to have such order corrected so that it will accord with the 
mandate, in which event the order of the Commission shall 
become final when so corrected.
  (j) Rehearing Upon Order or Remand.--If the Supreme Court 
orders a rehearing; or if the case is remanded by the court of 
appeals to the Commission for a rehearing, and if (1) the time 
allowed for filing a petition for certiorari has expired, and 
no such petition has been duly filed, or (2) the petition for 
certiorari has been denied, or (3) the decision of the court 
has been affirmed by the Supreme Court, then the order of the 
Commission rendered upon such rehearing shall become final in 
the same manner as though no prior order of the Commission had 
been rendered.
  (k) ``Mandate'' Defined.--As used in this section the term 
``mandate,'' in case a mandate has been recalled prior to the 
expiration of thirty days from the date of issuance thereof, 
means the final mandate.
  (l) Penalty for Violation of Order; Injunctions and Other 
Appropriate Equitable Relief.--Any person, partnership, or 
corporation who violates an order of the Commission after it 
has become final, and while such order is in effect, shall 
forfeit and pay to the United States a civil penalty of not 
more than $10,000 for each violation, which shall accrue to the 
United States and may be recovered in a civil action brought by 
the Attorney General of the United States. Each separate 
violation of such an order shall be a separate offense, except 
that in the case of a violation through continuing failure to 
obey or neglect to obey a final order of the Commission, each 
day of continuance of such failure or neglect shall be deemed a 
separate offense. In such actions, the United States district 
courts are empowered to grant mandatory injunctions and such 
other and further equitable relief as they deem appropriate in 
the enforcement of such final orders of the Commission.
  (m) Civil Actions for Recovery of Penalties for Knowing 
Violations of Rules and Cease and Desist Orders Respecting 
Unfair or Deceptive Acts or Practices; Jurisdiction; Maximum 
Amount of Penalties; Continuing Violations; de Novo 
Determinations; Compromise or Settlement Procedure.--(1)(A) The 
Commission may commence a civil action to recover a civil 
penalty in a district court of the United States against any 
person, partnership, or corporation which violates any rule 
under this Act respecting unfair or deceptive acts or practices 
(other than an interpretive rule or a rule violation of which 
the Commission has provided is not an unfair or deceptive act 
or practice in violation of subsection (a)(1)) with actual 
knowledge or knowledge fairly implied on the basis of objective 
circumstances that such act is unfair or deceptive and is 
prohibited by such rule. In such action, such person, 
partnership, or corporation shall be liable for a civil penalty 
of not more than $10,000 for each violation.
  (B) If the Commission determines in a proceeding under 
subsection (b) that any act or practice is unfair or deceptive, 
and issues a final cease and desist order, other than a consent 
order, with respect to such act or practice, then the 
Commission may commence a civil action to obtain a civil 
penalty in a district court of the United States against any 
person, partnership, or corporation which engages in such act 
or practice--
          (1) after such cease and desist order becomes final 
        (whether or not such person, partnership, or 
        corporation was subject to such cease and desist 
        order), and
          (2) with actual knowledge that such act or practice 
        is unfair or deceptive and is unlawful under subsection 
        (a)(1) of this section.
                In such action, such person, partnership, or 
                corporation shall be liable for a civil penalty 
                of not more than $ 10,000 for each violation.
  (C) In the case of a violation through continuing failure to 
comply with a rule or with section 5(a)(1), each day of 
continuance of such failure shall be treated as a separate 
violation, for purposes of subparagraphs (A) and (B). In 
determining the amount of such a civil penalty, the court shall 
take into account the degree of culpability, any history of 
prior such conduct, ability to pay, effect on ability to 
continue to do business, and such other matters as justice may 
require. (2) If the cease and desist order establishing that 
the act or practice is unfair or deceptive was not issued 
against the defendant in a civil penalty action under paragraph 
(1)(B) the issues of fact in such action against such defendant 
shall be tried de novo. Upon request of any party to such an 
action against such defendant, the court shall also review the 
determination of law made by the Commission in the proceeding 
under subsection (b) that the act or practice which was the 
subject of such proceeding constituted an unfair or deceptive 
act or practice in violation of subsection (a).
  (3) The Commission may compromise or settle any action for a 
civil penalty if such compromise or settlement is accompanied 
by a public statement of its reasons and is approved by the 
court.
  (n) Definition of Unfair Acts or Practices.--The Commission 
shall have no authority under this section or section 18 to 
declare unlawful an act or practice on the grounds that such 
act or practice is unfair unless the act or practice causes or 
is likely to cause substantial injury to consumers which is not 
reasonably avoidable by consumers themselves and not outweighed 
by countervailing benefits to consumers or to competition. In 
determining whether an act or practice is unfair, the 
Commission may consider established public policies as evidence 
to be considered with all other evidence. Such public policy 
considerations may not serve as a primary basis for such 
determination.
  (o) Unfair or Deceptive Acts or Practices Involving Foreign 
Commerce.--
          (1) In general.--For purposes of subsection (a), the 
        term ``unfair or deceptive acts or practices'' includes 
        such acts or practices involving foreign commerce 
        that--
                  (A) cause or are likely to cause reasonably 
                foreseeable injury within the United States; or
                  (B) involve material conduct occurring within 
                the United States.
          (2) Application of remedies to such acts or 
        practices.--All remedies available to the Commission 
        with respect to unfair and deceptive acts or practices 
        shall be available for acts and practices described in 
        paragraph (1), including restitution to domestic or 
        foreign victims.

SEC. 6. ADDITIONAL POWERS OF COMMISSION.

                             [15 U.S.C. 46]

  The commission shall also have power--
          (1) Investigation of persons, partnerships, or 
        corporations.--To gather and compile information 
        concerning, and to investigate from time to time the 
        organization, business, conduct, practices, and 
        management of any person, partnership, or corporation 
        engaged in or whose business affects commerce, 
        excepting 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, and its 
        relation to other persons, partnerships, and 
        corporations.
          (2) Reports of persons, partnerships, and 
        corporations.--To require, by general or special 
        orders, persons, partnerships, and corporations engaged 
        in or whose business affects commerce, excepting 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, or any class of them, or any of 
        them, respectively, to file with the commission in such 
        form as the commission may prescribe annual or special, 
        or both annual and special, reports, or answers in 
        writing to specific questions, furnishing to the 
        commission such information as it may require as to the 
        organization, business, conduct, practices, management, 
        and relation to other corporations, partnerships, and 
        individuals of the respective persons, partnerships, 
        and corporations filing such reports or answers in 
        writing. Such reports and answers shall be made under 
        oath, or otherwise, as the commission may prescribe, 
        and shall be filed with the commission within such 
        reasonable period as the commission may prescribe, 
        unless additional time be granted in any case by the 
        commission.
          (3) Investigation of compliance with antitrust 
        decrees.--Whenever a final decree has been entered 
        against any defendant corporation in any suit brought 
        by the United States to prevent and restrain any 
        violation of the antitrust Acts, to make investigation, 
        upon its own initiative, of the manner in which the 
        decree has been or is being carried out, and upon the 
        application of the Attorney General it shall be its 
        duty to make such investigation. It shall transmit to 
        the Attorney General a report embodying its findings 
        and recommendations as a result of any such 
        investigation, and the report shall be made public in 
        the discretion of the commission.
          (4) Investigations of violations of antitrust 
        statutes.--Upon the direction of the President or 
        either House of Congress to investigate and report the 
        facts relating to any alleged violations of the 
        antitrust Acts by any corporation.
          (5) Readjustment of business of corporations 
        violating antitrust statutes.--Upon the application of 
        the Attorney General to investigate and make 
        recommendations for the readjustment of the business of 
        any corporation alleged to be violating the antitrust 
        Acts in order that the corporation may thereafter 
        maintain its organization, management, and conduct of 
        business in accordance with law.
          (6) Publication of information; reports.--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 sharing material with foreign law 
        enforcement agencies is permitted under section 
        21(b)(6) of this Act.
          (7) Classification of corporations; regulations.--
        From time to time to classify corporations and (except 
        as provided in section 18(a)(2) of this Act) to make 
        rules and regulations for the purpose of carrying out 
        the provisions of this Act.
          (8) Investigations of foreign trade conditions; 
        reports.--To investigate, from time to time, trade 
        conditions in and with foreign countries where 
        associations, combinations, or practices of 
        manufacturers, merchants, or traders, or other 
        conditions, may affect the foreign trade of the United 
        States, and to report to Congress thereon, with such 
        recommendations as it deems advisable.
          (9) With respect to the International Antitrust 
        Enforcement Assistance Act of 1994, to conduct 
        investigations of possible violations of foreign 
        antitrust laws (as defined in section 12 of such Act). 
        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) 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.
          (10)(A) Upon 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 that may be 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, in its discretion--
                  (i) 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
                  (ii) 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, when the request 
                is from an agency acting to investigate or 
                pursue the enforcement of civil laws or when 
                the Attorney General refers such a request to 
                the Commission.
          (B) The Commission may provide assistance under 
        paragraph (1) without requiring that the conduct 
        identified in the request also constitutes a violation 
        of the laws of the United States.
          (C) In deciding whether to provide such assistance, 
        the Commission shall consider all relevant factors, 
        including--
                  (i) whether the requesting agency has agreed 
                to provide or will provide reciprocal 
                assistance to the Commission;
                  (ii) whether compliance with the request 
                would prejudice the public interest of the 
                United States; and
                  (iii) 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.
          (D) 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 disclosure of 
        materials or information to the Commission, the 
        Commission, after consultation with the Secretary of 
        State, may negotiate and conclude an international 
        agreement, in the name of either the United States or 
        the Commission and with the final approval of the 
        agreement by the Secretary of State, for the purpose of 
        obtaining such assistance or disclosure. The Commission 
        may undertake in such an international agreement--
                  (i) to provide assistance using the powers 
                set forth in this subsection;
                  (ii) to disclose materials and information in 
                accordance with subsection (f) of this section 
                and section 21(b)(6) of this Act; and
                  (iii) to engage in further cooperation, and 
                protect materials and information received from 
                disclosure, as authorized by this Act.
          (E) The authority in 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.
          (11) Referral for criminal proceedings.--
                  (A) 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, to transmit 
                such evidence to the Attorney General who may, 
                in his discretion, institute criminal 
                proceedings under appropriate statutes. Nothing 
                in this paragraph affects any other authority 
                of the Commission to disclose information.
                  (B) 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.
          (12) International coordination activities.--To 
        expend appropriated funds for--
                  (A) 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
                  (B) 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--
                          (i) such incidental expenses as meals 
                        taken in the course of such attendance;
                          (ii) any travel and transportation to 
                        or from such meetings; and
                  (C) any other related lodging or subsistence.

SEC. 16. COMMENCEMENT, DEFENSE, INTERVENTION AND SUPERVISION OF 
                    LITIGATION AND APPEAL BY COMMISSION OR ATTORNEY 
                    GENERAL.

                             [15 U.S.C. 56]

  (a) Procedure for Exercise of Authority to Litigate or 
Appeal.--(1) Except as otherwise provided in paragraph (2) or 
(3), if--
          (A) before commencing, defending, or intervening in, 
        any civil action involving this Act (including an 
        action to collect a civil penalty) which the 
        Commission, or the Attorney General on behalf of the 
        Commission, is authorized to commence, defend, or 
        intervene in, the Commission gives written notification 
        and undertakes to consult with the Attorney General 
        with respect to such action; and
          (B) the Attorney General fails within 45 days after 
        receipt of such notification to commence, defend, or 
        intervene in, such action;
the Commission may commence, defend, or intervene in, and 
supervise the litigation of, such action and any appeal of such 
action in its own name by any of its attorneys designated by it 
for such purpose.
  (2) Except as otherwise provided in paragraph (3), in any 
civil action--
          (A) under section 13 of this Act (relating to 
        injunctive relief);
          (B) under section 19 of this Act (relating to 
        consumer redress);
          (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 a 
        compliance with section 6 of this Act); and
          (E) under section 21a of this Act;
the Commission shall have exclusive authority to commence or 
defend, and supervise the litigation of, such action and any 
appeal of such action in its own name by any of its attorneys 
designated by it for such purpose, unless the Commission 
authorizes the Attorney General to do so. The Commission shall 
inform the Attorney General of the exercise of such authority 
and such exercise shall not preclude the Attorney General from 
intervening on behalf of the United States in such action and 
any appeal of such action as may be otherwise provided by law.
  (3)(A) If the Commission makes a written request to the 
Attorney General, within the 10-day period which begins on the 
date of the entry of the judgment in any civil action in which 
the Commission represented itself pursuant to paragraph (1) or 
(2), to represent itself through any of its attorneys 
designated by it for such purpose before the Supreme Court in 
such action, it may do so, if--
          (i) the Attorney General concurs with such request; 
        or
          (ii) the Attorney General, within the 60-day period 
        which begins on the date of the entry of such 
        judgment--
                  (I) refuses to appeal or file a petition for 
                writ of certiorari with respect to such civil 
                action, in which case he shall give written 
                notification to the Commission of the reasons 
                for such refusal within such 60-day period; or
                  (II) the Attorney General fails to take any 
                action with respect to the Commission's 
                request.
  (B) In any case where the Attorney General represents the 
Commission before the Supreme Court in any civil action in 
which the Commission represented itself pursuant to paragraph 
(1) or (2), the Attorney General may not agree to any 
settlement, compromise, or dismissal of such action, or confess 
error in the Supreme Court with respect to such action, unless 
the Commission concurs.
  (C) For purposes of this paragraph (with respect to 
representation before the Supreme Court), the term ``Attorney 
General'' includes the Solicitor General.
  (4) If, prior to the expiration of the 45-day period 
specified in paragraph (1) of this section or a 60-day period 
specified in paragraph (3), any right of the Commission to 
commence, defend, or intervene in, any such action or appeal 
may be extinguished due to any procedural requirement of any 
court with respect to the time in which any pleadings, notice 
of appeal, or other acts pertaining to such action or appeal 
may be taken, the Attorney General shall have one-half of the 
time required to comply with any such procedural requirement of 
the court (including any extension of such time granted by the 
court) for the purpose of commencing, defending, or intervening 
in the civil action pursuant to paragraph (1) or for the 
purpose of refusing to appeal or file a petition for writ of 
certiorari and the written notification or failing to take any 
action pursuant to paragraph 3(A)(ii).
  (5) The provisions of this subsection shall apply 
notwithstanding chapter 31 of title 28, United States Code, or 
any other provision of law.
  (b) Certification by Commission to Attorney General for 
Criminal Proceedings.--Whenever the Commission has reason to 
believe that any person, partnership, or corporation is liable 
for a criminal penalty under this Act, the Commission shall 
certify the facts to the Attorney General, whose duty it shall 
be to cause appropriate criminal proceedings to be brought.
  (c)(1) The Commission may designate Commission attorneys to 
assist the Department of Justice in connection with litigation 
in foreign courts in which the Commission has an interest, 
pursuant to the terms of a memorandum of understanding to be 
negotiated by the Commission and the Department of Justice. The 
preceding sentence is in addition to, and not in lieu of, any 
other authority vested in the Commission or any other officer 
of the United States.
  (2) The Commission is authorized to expend appropriated funds 
for the retention of foreign counsel for consultation and for 
litigation in foreign courts, and for expenses related to 
consultation and to litigation in foreign courts in which the 
Commission has an interest.
  (3) Nothing in this section 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.

SEC. 21. CONFIDENTIALITY.

                           [15 U.S.C. 57B-2]

  (a) Definitions.--For purposes of this section:
          (1) The term ``material'' means documentary material, 
        tangible things, written reports or answers to 
        questions, and transcripts of oral testimony.
          (2) The term ``Federal agency'' has the meaning given 
        it in section 552(e) of title 5, United States Code.
  (b) Procedures Respecting Documents, Tangible Things, or 
Transcripts of Oral Testimony Received Pursuant to Compulsory 
Process in Investigation.--(1) With respect to any document, 
tangible thing, or transcript of oral testimony received by the 
Commission pursuant to compulsory process in an investigation, 
a purpose of which is to determine whether any person may have 
violated any provision of the laws administered by the 
Commission, the procedures established in paragraph (2) through 
paragraph (7) shall apply.
  (2)(A) The Commission shall designate a duly authorized agent 
to serve as custodian of documentary material, tangible things, 
or written reports or answers to questions, and transcripts of 
oral testimony, and such additional duly authorized agents as 
the Commission shall determine from time to time to be 
necessary to serve as deputies to the custodian.
  (B) Any person upon whom any demand for the production of 
documentary material has been duly served shall make such 
material available for inspection and copying or reproduction 
to the custodian designated in such demand at the principal 
place of business of such person (or at such other place as 
such custodian and such person thereafter may agree and 
prescribe in writing or as the court may direct pursuant to 
section 20(h)) on the return date specified in such demand (or 
on such later date as such custodian may prescribe in writing). 
Such person may upon written agreement between such person and 
the custodian substitute copies for originals of all or any 
part of such material.
  (3)(A) The custodian to whom any documentary material, 
tangible things, written reports or answers to questions, and 
transcripts of oral testimony are delivered shall take physical 
possession of such material, reports or answers, and 
transcripts, and shall be responsible for the use made of such 
material, reports or answers, and transcripts, and for the 
return of material, pursuant to the requirements of this 
section.
  (B) The custodian may prepare such copies of the documentary 
material, written reports or answers to questions, and 
transcripts of oral testimony, and may make tangible things 
available, as may be required for official use by any duly 
authorized officer or employee of the Commission under 
regulations which shall be promulgated by the Commission. 
Notwithstanding subparagraph (C), such material, things, and 
transcripts may be used by any such officer or employee in 
connection with the taking of oral testimony under this 
section.
  (C) Except as otherwise provided in this section, while in 
the possession of the custodian, no documentary material, 
tangible things, reports or answers to questions, and 
transcripts of oral testimony shall be available for 
examination by any individual other than a duly authorized 
officer or employee of the Commission without the consent of 
the person who produced the material, things, or transcripts. 
Nothing in this section is intended to prevent disclosure to 
either House of the Congress or to any committee or 
subcommittee of the Congress, except that the Commission 
immediately shall notify the owner or provider of any such 
information of a request for information designated as 
confidential by the owner or provider.
  (D) While in the possession of the custodian and under such 
reasonable terms and conditions as the Commission shall 
prescribe--
          (i) documentary material, tangible things, or written 
        reports shall be available for examination by the 
        person who produced the material, or by any duly 
        authorized representative of such person; and
          (ii) answers to questions in writing and transcripts 
        of oral testimony shall be available for examination by 
        the person who produced the testimony or by his 
        attorney.
  (4) Whenever the Commission has instituted a proceeding 
against a person, partnership, or corporation, the custodian 
may deliver to any officer or employee of the Commission 
documentary material, tangible things, written reports or 
answers to questions, and transcripts of oral testimony for 
official use in connection with such proceeding. Upon the 
completion of the proceeding, the officer or employee shall 
return to the custodian any such material so delivered which 
has not been received into the record of the proceeding.
  (5) If any documentary material, tangible things, written 
reports or answers to questions, and transcripts of oral 
testimony have been produced in the course of any investigation 
by any person pursuant to compulsory process and--
          (A) any proceeding arising out of the investigation 
        has been completed; or
          (B) no proceeding in which the material may be used 
        has been commenced within a reasonable time after 
        completion of the examination and analysis of all such 
        material and other information assembled in the course 
        of the investigation; then the custodian shall, upon 
        written request of the person who produced the 
        material, return to the person any such material which 
        has not been received into the record of any such 
        proceeding (other than copies of such material made by 
        the custodian pursuant to paragraph (3)(B)).
  (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 any officer of any such 
foreign law enforcement agency 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; and
          (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 similar to practices prohibited by 
                any law administered by the Commission;
                  (ii) 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, foreign criminal laws.
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 (16 
U.S.C. 6211) to any officer or employee of a foreign law 
enforcement agency.
  (7) In the event of the death, disability, or separation from 
service in the Commission of the custodian of any documentary 
material, tangible things, written reports or answers to 
questions, and transcripts of oral testimony produced under any 
demand issued under this Act, or the official relief of the 
custodian from responsibility for the custody and control of 
such material, the Commission promptly shall--
          (A) designate under paragraph (2)(A) another duly 
        authorized agent to serve as custodian of such 
        material; and
          (B) transmit in writing to the person who produced 
        the material or testimony notice as to the identity and 
        address of the successor so designated.
Any successor designated under paragraph (2)(A) as a result of 
the requirements of this paragraph shall have (with regard to 
the material involved) all duties and responsibilities imposed 
by this section upon his predecessor in office with regard to 
such material, except that he shall not be held responsible for 
any default or dereliction which occurred before his 
designation.
  (c) Information Considered Confidential.--(1) All information 
reported to or otherwise obtained by the Commission which is 
not subject to the requirements of subsection (b) shall be 
considered confidential when so marked by the person supplying 
the information and shall not be disclosed, except in 
accordance with the procedures established in paragraph (2) and 
paragraph (3).
  (2) If the Commission determines that a document marked 
confidential by the person supplying it may be disclosed 
because it is not a trade secret or commercial or financial 
information which is obtained from any person and which is 
privileged or confidential, within the meaning of section 6(f), 
then the Commission shall notify such person in writing that 
the Commission intends to disclose the document at a date not 
less than 10 days after the date of receipt of notification.
  (3) Any person receiving such notification may, if he 
believes disclosure of the document would cause disclosure of a 
trade secret, or commercial or financial information which is 
obtained from any person and which is privileged or 
confidential, within the meaning of section 6(f), before the 
date set for release of the document, bring an action in the 
district court of the United States for the district within 
which the documents are located or in the United States 
District Court for the District of Columbia to restrain 
disclosure of the document. Any person receiving such 
notification may file with the appropriate district court or 
court of appeals of the United States, as appropriate, an 
application for a stay of disclosure. The documents shall not 
be disclosed until the court has ruled on the application for a 
stay.
  (d) Particular Disclosures Allowed.--(1) The provisions of 
subsection (c) shall not be construed to prohibit--
          (A) the disclosure of information to either House of 
        the Congress or to any committee or subcommittee of the 
        Congress, except that the Commission immediately shall 
        notify the owner or provider of any such information of 
        a request for information designated as confidential by 
        the owner or provider;
          (B) the disclosure of the results of any 
        investigation or study carried out or prepared by the 
        Commission, except that no information shall be 
        identified nor shall information be disclosed in such a 
        manner as to disclose a trade secret of any person 
        supplying the trade secret, or to disclose any 
        commercial or financial information which is obtained 
        from any person and which is privileged or 
        confidential;
          (C) the disclosure of relevant and material 
        information in Commission adjudicative proceedings or 
        in judicial proceedings to which the Commission is a 
        party; or
          (D) the disclosure to a Federal agency of 
        disaggregated information obtained in accordance with 
        section 3512 of title 44, United States Code, except 
        that the recipient agency shall use such disaggregated 
        information for economic, statistical, or policymaking 
        purposes only, and shall not disclose such information 
        in an individually identifiable form.
  (2) Any disclosure of relevant and material information in 
Commission adjudicative proceedings or in judicial proceedings 
to which the Commission is a party shall be governed by the 
rules of the Commission for adjudicative proceedings or by 
court rules or orders, except that the rules of the Commission 
shall not be amended in a manner inconsistent with the purposes 
of this section.
  (e) Effect on Other Statutory Provisions Limiting 
Disclosure.--Nothing in this section shall supersede any 
statutory provision which expressly prohibits or limits 
particular disclosures by the Commission, or which authorizes 
disclosures to any other Federal agency.
  (f) Exemption from Disclosure.--(1) 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.
  (2)(A) Except as provided in subparagraph (C) of this 
paragraph, the Commission shall not be compelled to disclose--
          (i) 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 disclosing the material;
          (ii) material reflecting consumer complaints obtained 
        from any other foreign source, if that foreign source 
        supplying the material has requested confidential 
        treatment as a condition of disclosing the material; or
          (iii) 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) For purposes of section 552 of title 5, this paragraph 
shall be considered a statute described in subsection (b)(3)(B) 
of such section 552.
  (C) Nothing in this paragraph 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) In General.--The provisions for delay or prohibition of 
notice under the Right to Financial Privacy Act (12 U.S.C. 3401 
et seq.) and the Electronic Communication Privacy Act (18 
U.S.C. 2701 et seq.) shall be available to the Commission--
          (1) upon a finding by the presiding judge or 
        magistrate judge pursuant to an ex parte application by 
        the Commission that there is reason to believe that 
        notification may cause an adverse result; or
          (2) where notification is delayed pursuant to section 
        2705(a)(1)(B) of title 18, a finding by the Commission 
        that there is reason to believe that notification may 
        cause an adverse result.
  (b) Ex Parte Application by Commission.--If the provisions 
for delayed notice described in subsection (a) do not apply, 
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 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 
shall enter such an order granting the requested delay for a 
period not to exceed 90 days, or for such period as the 
presiding judge or magistrate judge deems appropriate, 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 90 days each in 
accordance with this subsection.
  (c) No Liability for Compliance.--The recipient of compulsory 
process issued by the Commission under this section 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 that such process has been issued or that the recipient 
has provided information in response to such process. The 
preceding sentence does not provide any exemption from 
liability for the underlying conduct.
  (d) Venue and Procedure.--
          (1) In general.--All judicial proceedings under 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.
  (e) 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 (within the meaning of 
section 6211 of this title).
  (f) Adverse Result Defined.--In this section the term 
``adverse result'' means--
          (1) the transfer of assets or records outside the 
        territorial limits of the United States;
          (2) impeding the ability of the Commission to 
        identify or trace funds;
          (3) endangering the life or physical safety of an 
        individual;
          (4) flight from prosecution;
          (5) the destruction of, or tampering with, evidence;
          (6) the intimidation of potential witnesses;
          (7) the dissipation or concealment of assets; or
          (8) otherwise seriously jeopardizing an investigation 
        or unduly delaying a trial.

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

  (a) In General.--An entity described in subsection (e)(1) 
that voluntarily provides material to the Commission that it 
reasonably believes is relevant to--
          (1) a possible unfair or deceptive act or practice, 
        as defined in section 5(a) of this Act, or
          (2) 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 disclosure or for any failure to provide notice of 
such disclosure. The preceding sentence does not provide any 
exemption from liability for the underlying conduct.
  (b) Liability Limitation.--An entity described in subsection 
(e)(2) that makes a voluntary disclosure to the Commission 
regarding the subjects described in subsection (a)(1) and (2) 
shall be exempt from liability in accordance with the 
provisions of section 5318(g)(3) of title 31, United States 
Code.
  (c) Consumer Complaints.--Any entity described in subsection 
(e) that makes a voluntary disclosure of 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 disclosure or for any failure to provide notice of 
such disclosure. The preceding sentence does not provide any 
exemption from liability for the underlying conduct.
  (d) FOIA Exemption.--Material submitted pursuant to this 
section with a request for confidential treatment shall be 
exempt from disclosure under section 552 of title 5, United 
States Code, to the extent it could reasonably be expected to 
disclose either the identity of persons, partnerships, or 
corporations that are the subject of such disclosures, or the 
identification of particular financial accounts, their 
ownership, or confidential records of account activity. This 
exemption is in addition to, and not in lieu of, any other 
applicable exemptions from disclosure in such section 552.
  (e) Entities to Which Section Applies.--This section applies 
to the following entities, whether foreign or domestic:
          (1) A courier service, a commercial mail receiving 
        agency, an industry membership organization, a payment 
        system provider, a consumer reporting agency, a domain 
        name registrar and registry, and a provider of 
        alternative dispute resolution services;
          (2) 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; and
          (3) an Internet service provider or provider of 
        telephone services.

SEC. 25. AUTHORIZATION OF APPROPRIATIONS.

                            [15 U.S.C. 57C]

  [There are authorized to be appropriated to carry out the 
functions, powers, and duties of the Commission not to exceed 
$92,700,000 for fiscal year 1994; not to exceed $99,000,000 for 
fiscal year 1995; not to exceed $102,000,000 for fiscal year 
1996; not to exceed $107,000,000 for fiscal year 1997; and not 
to exceed $111,000,000 for fiscal year 1998.]
  There are authorized to be appropriated to carry out the 
functions, powers, and duties of the Commission not to exceed 
$194,742,000 for fiscal year 2004, $224,695,000 for fiscal year 
2005, $235,457,000 for fiscal year 2006, and $245,000,000 for 
fiscal year 2007.

SEC. 25A. STAFF EXCHANGES.

  (a) In General.--The Congress consents to--
          (1) the retention or employment of officers or 
        employees of foreign government agencies on a temporary 
        basis by the Commission under section 3109 of title 5, 
        United States Code, section 202 of title 18, United 
        States Code, or section 2 of this Act (15 U.S.C. 42); 
        and
          (2) the retention or employment of officers or 
        employees of the Commission on a temporary basis by 
        such foreign government agencies.
  (b) Form of Arrangements.--Staff arrangements under 
subsection (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.

SEC. 26. REIMBURSEMENT OF EXPENSES.

  The Commission may accept payment or reimbursement, in cash 
or in kind, from a domestic or foreign law enforcement 
authority, or payment or reimbursement made on behalf of such 
authority, for expenses incurred by the Commission, its 
members, or employees in carrying out any activity pursuant to 
a statute administered by the Commission without regard to any 
other provision of law. Any such payments or reimbursements 
shall be considered a reimbursement to the appropriated funds 
of the Commission.

SEC. 27. GIFTS AND VOLUNTARY AND UNCOMPENSATED SERVICES.

  (a) In General.--In furtherance of its functions the 
Commission may accept, hold, administer, and use unconditional 
gifts, donations, and bequests of real, personal, and other 
property and, notwithstanding section 1342 of title 31, United 
States Code, accept voluntary and uncompensated services.
  (b) Limitations.--
          (1) Conflicts of interest.--Notwithstanding 
        subsection (a), the Commission may not accept, hold, 
        administer, or use a gift, donation, or bequest if the 
        acceptance, holding, administration, or use would 
        create a conflict of interest or the appearance of a 
        conflict of interest.
          (2) Voluntary services.--A person who provides 
        voluntary and uncompensated service under subsection 
        (a) shall be considered a Federal employee for purposes 
        of--
                  (A) chapter 81 of title 5, United States 
                Code, (relating to compensation for injury);
                  (B) sections 2671 through 2680 of title 28, 
                United States Code, (relating to tort claims); 
                and
                  (C) for purposes of 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.

[SEC. 26. SHORT TITLE.]

                             [15 U.S.C. 58]

SEC. 28. SHORT TITLE.

  This Act may be cited as the ``Federal Trade Commission 
Act.''

       Additional, Supplemental, or Minority Views deg.

                                
