[Senate Report 112-248]
[From the U.S. Government Publishing Office]


                                                       Calendar No. 479
112th Congress  }                                             {  Report
  2d Session    }              SENATE                         { 112-248
_______________________________________________________________________

 
       A BILL TO EXTEND THE UNDERTAKING SPAM, SPYWARE, AND FRAUD 

         ENFORCEMENT WITH ENFORCERS BEYOND BORDERS ACT OF 2006, 

                         AND FOR OTHER PURPOSES 

                               __________

                              R E P O R T

                                 OF THE

           COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                                   on

                                S. 3410

                  [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                                     

                December 5, 2012.--Ordered to be printed

                                   -----

                         U.S. GOVERNMENT PRINTING OFFICE 

29-010 PDF                       WASHINGTON : 2012 



       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
                      one hundred twelfth congress
                             second session

            JOHN D. ROCKEFELLER IV, West Virginia, Chairman
DANIEL K. INOUYE, Hawaii             KAY BAILEY HUTCHISON, Texas
JOHN F. KERRY, Massachusetts         OLYMPIA J. SNOWE, Maine
BARBARA BOXER, California            JIM DeMINT, South Carolina
BILL NELSON, Florida                 JOHN THUNE, South Dakota
MARIA CANTWELL, Washington           ROGER F. WICKER, Mississippi
FRANK R. LAUTENBERG, New Jersey      JOHNNY ISAKSON, Georgia
MARK PRYOR, Arkansas                 ROY BLUNT, Missouri
CLAIRE McCASKILL, Missouri           JOHN BOOZMAN, Arkansas
AMY KLOBUCHAR, Minnesota             PATRICK J. TOOMEY, Pennsylvania
TOM UDALL, New Mexico                MARCO RUBIO, Florida
MARK WARNER, Virginia                KELLY AYOTTE, New Hampshire
MARK BEGICH, Alaska                  DEAN HELLER, Nevada
                     Ellen Doneski, Staff Director
                   James Reid, Deputy Staff Director
                     John Williams, General Counsel
               Richard Russell, Republican Staff Director
            David Quinalty, Republican Deputy Staff Director
               Rebecca Seidel, Republican General Counsel



                                                       Calendar No. 479
112th Congress  }                                            {   Report
  2d Session    }               SENATE                       {  112-248

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


 A BILL TO EXTEND THE UNDERTAKING SPAM, SPYWARE, AND FRAUD ENFORCEMENT 
   WITH ENFORCERS BEYOND BORDERS ACT OF 2006, AND FOR OTHER PURPOSES

                                _______
                                

                December 5, 2012.--Ordered to be printed

                                _______
                                

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

                                 REPORT

                         [To accompany S. 3410]

  The Committee on Commerce, Science, and Transportation, to 
which was referred the bill (S. 3410) to extend the Undertaking 
Spam, Spyware, And Fraud Enforcement With Enforcers beyond 
Borders Act of 2006, and for other purposes, having considered 
the same, reports favorably thereon without amendment and 
recommends that the bill do pass.

                          Purpose of the Bill

  The purpose of S. 3410, a bill to extend the Undertaking 
Spam, Spyware, And Fraud Enforcement With Enforcers beyond 
Borders Act of 2006 (known as the ``U.S. SAFE WEB Act of 2006'' 
or ``SAFE WEB''), is to extend the authority and provisions of 
the U.S. SAFE WEB Act of 2006 for seven additional years.

                          Background and Needs

  In December 2006, Congress passed the U.S. SAFE WEB Act of 
2006, which provides the Federal Trade Commission (FTC) with 
enforcement tools that allow the Commission to pursue fraud 
perpetrated by actors outside of the United States. In so 
doing, SAFE WEB enhances the FTC's authority to deal with 
cross-border fraud in four key ways:
  
           Information Sharing.--SAFE WEB authorizes 
        the FTC to reciprocally exchange confidential 
        information with foreign law enforcement to aid foreign 
        and domestic investigations.
  
           Investigative Assistance.--SAFE WEB permits 
        the FTC to provide investigative assistance to and 
        conduct discovery for foreign law enforcement in 
        appropriate cases which in turn, allows the FTC to 
        receive similar foreign investigative assistance.
  
           Cross-border Jurisdiction Authority.--The 
        law provides the FTC with litigation authority to 
        redress harm in the United States caused by foreign 
        actors, as well as harm caused by U.S. actors abroad. 
        This provision allows the FTC to avoid challenges to 
        its cross-border jurisdiction and helps encourage the 
        availability of all remedies for U.S. consumer victims 
        in foreign courts.
  
           Enforcement Relationships.--The law 
        authorizes the FTC to retain employees from foreign 
        agencies on a temporary basis, which fosters the 
        establishment of trust and understanding between 
        agencies and facilitates more meaningful case 
        cooperation.
  
  SAFE WEB has a seven-year sunset provision that is scheduled 
to expire in December 2013. All five Commissioners on the FTC, 
which enforces the law, support the extension of SAFE WEB.

                         Summary of Provisions

  S. 3410 extends the sunset provision in SAFE WEB by another 
seven years to September 2020. The bill does not change any 
substantive provisions in the law.

                          Legislative History

  On July 19, 2012, Senator Pryor introduced S. 3410, which was 
referred to the Committee for consideration. The bill is co-
sponsored by Senator Ayotte. On July 31, 2012, in an open 
Executive Session, the Committee considered S. 3410 and 
favorably reported the bill 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:
S. 3410--A bill to extend the Undertaking Spam, Spyware, And Fraud 
        Enforcement With Enforcers beyond Borders Act of 2006, and for 
        other purposes
    CBO estimates that implementing S. 3410 would have no 
significant effect on discretionary spending over the 2013-2017 
period. Enacting S. 3410 could result in collections of 
additional civil and criminal penalties, which would affect 
both revenues and direct spending; therefore, pay-as-you-go 
procedures apply. However, CBO estimates that those effects 
also would be insignificant.
    S. 3410 would reauthorize the Undertaking Spam, Spyware, 
And Fraud Enforcement With Enforcers beyond Borders Act, which 
will expire on December 22, 2013. The act provides 
administrative tools to the Federal Trade Commission (FTC) that 
augment its authority to enforce federal laws related to unfair 
and deceptive trade practices, such as sharing information with 
foreign agencies and investigating fraud that originates 
outside of the United States. The bill also would extend an 
authorization to appropriate $100,000 each year for the FTC to 
collaborate with foreign governments and to participate in 
multinational organizations related to law enforcement. Based 
on information from the FTC, CBO expects that enacting S. 3410 
could change the types of fraud cases the agency investigates 
but would not change the agency's workload. Therefore, CBO 
estimates that implementing S. 3410 would not have a 
significant effect on discretionary costs over the 2013-2017 
period.
    Enacting S. 3410 could increase federal revenues and direct 
spending as a result of additional criminal and civil penalties 
assessed for violations of laws related to unfair and deceptive 
trade practices. Collections of civil penalties are recorded in 
the budget as revenues. Collections of criminal penalties are 
recorded in the budget as revenues, deposited in the Crime 
Victims Fund, and later spent. CBO estimates that the net 
effects of those transactions would be insignificant for each 
year because of the relatively small number of cases likely to 
be involved.
    S. 3410 would impose intergovernmental mandates, as defined 
in the Unfunded Mandates Reform Act (UMRA), by extending 
preemptions of state and local laws that prohibit individuals 
from disclosing information to the FTC and that require 
individuals to notify third parties if they disclose 
information to the FTC. Under current law, the preemptions 
would expire at the end of 2013; the bill would extend them 
until September 30, 2020. While the preemptions would limit the 
application of state and local law, CBO estimates that they 
would impose no duty on state, local, or tribal governments 
that would result in additional spending.
    S. 3410 also would extend an existing mandate that exempts 
from liability private entities that voluntarily provide 
certain information about third parties to the FTC. The 
extension of such protections constitutes a mandate on those 
third-party entities because it limits their ability to file a 
claim for the disclosure or failure to provide notice of 
disclosure. The cost of the mandate would be the forgone net 
value of settlements and damages that would have been awarded. 
Based on information from the FTC, few such lawsuits would 
probably be filed. Therefore, CBO expects that the cost of the 
mandate would fall below the annual threshold for private-
sector mandates established in UMRA ($146 million, adjusted 
annually for inflation).
    On August 16, 2012, CBO transmitted a cost estimate for 
H.R. 6131, a bill to extend the Undertaking Spam, Spyware, And 
Fraud Enforcement With Enforcers beyond Borders Act of 2006, as 
ordered reported by the House Committee on Energy and Commerce 
on July 31, 2012. The language extending the act is identical 
in both the House and Senate bills, and the CBO estimates of 
the cost for each bill are the same.
    The CBO staff contacts for this estimate are Susan Willie 
(for federal costs), Elizabeth Cove Delisle (for the impact on 
state and local governments), and Marin Randall (for the impact 
on the private sector). The estimate was approved by Theresa 
Gullo, Deputy 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

  Because S. 3410 does not create any new programs and only 
extends existing law, the legislation will have no impact on 
the number or types of individuals or businesses regulated.

                            ECONOMIC IMPACT

  S. 3410 will have no further impact on the Nation's economy.

                                PRIVACY

  S. 3410 will not have any adverse impact on the personal 
privacy of affected individuals.

                               PAPERWORK

  S. 3410 will not increase paperwork requirements for private 
individuals or businesses.

                   Congressionally Directed Spending

  In compliance with paragraph 4(b) of rule XLIV of the 
Standing Rules of the Senate, the Committee provides that no 
provisions contained in the bill, as reported, meet the 
definition of congressionally directed spending items under the 
rule.

                      Section-by-Section Analysis

Section 1. Extension of the U.S. SAFE WEB Act of 2006
  Section 1 establishes the new sunset date for SAFE WEB as 
September 30, 2020.

                        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):
  

UNDERTAKING SPAM, SPYWARE, AND FRAUD ENFORCEMENT WITH ENFORCERS BEYOND 
                          BORDERS ACT OF 2006

SEC. 13. SUNSET.

                          [15 U.S.C. 44 note]

  [This Act, and the amendments made by this Act, shall cease 
to have effect on the date that is 7 years after the date of 
enactment of this Act.]
  Effective September 30, 2020, this Act, and the amendments 
made by this Act, are repealed, and any provision of law 
amended by this Act shall be amended to read as if this Act had 
not been enacted into law.

                                  
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