119-hr2889

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2889 Introduced in House

    (IH) ]

<DOC>

119th CONGRESS
 1st Session
 H. R. 2889

 To clarify that a violation of certain terms of service and related 
 materials is an unfair or deceptive act or practice and subject to 
 enforcement by the Federal Trade Commission.

_______________________________________________________________________

 IN THE HOUSE OF REPRESENTATIVES

 April 10, 2025

 Ms. Schakowsky (for herself and Ms. Castor of Florida) introduced the 
 following bill; which was referred to the Committee on Energy and 
 Commerce

_______________________________________________________________________

 A BILL

 To clarify that a violation of certain terms of service and related 
 materials is an unfair or deceptive act or practice and subject to 
 enforcement by the Federal Trade Commission.

 Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

 This Act may be cited as the ``Online Consumer Protection Act''.

SEC. 2. TERMS OF SERVICE REQUIRED FOR SOCIAL MEDIA PLATFORMS AND ONLINE 
 MARKETPLACES.

    (a) In General.--Each social media platform or online marketplace 
shall establish, maintain, and make publicly available at all times and 
in a machine-readable format, terms of service in a manner that is 
clear, easily understood, and written in plain and concise language. 
The terms of service shall meet the following requirements:

    (1) The terms of service shall include--
        (A) any terms or conditions of use of any service 
 provided by such person to a consumer;
        (B) any policies of such person with regard to such 
 service or use of such service by a consumer; and
            (C) the consumer protection policy consistent with 
 subsection

    (b) .

    (2) The terms of service shall cover issues related to the 
 behavior of a service or a user of such service, and shall at a 
 minimum include terms of use related to--
        (A) payment methods;
        (B) content ownership, including content generated 
 by a user;
            (C) policies related to sharing user content with 
 third parties;
            (D) any disclaimers, limitations, notices of 
 nonliability, or the consequences of not agreeing to or 
 complying with the terms of service; and
        (E) any other topic the Commission deems 
 appropriate.

    (b) Required Consumer Protection 

=== Policy ===
-

    (1) For social media platforms.--For social media 
 platforms, the consumer protection policy required by 
 subsection

    (a) shall include--
        (A) a description of the content and behavior 
 permitted or prohibited on its service both by the 
 platform and by users;
        (B) whether content may be blocked, removed, or 
 modified, or if service to users may be terminated and 
 the grounds upon which such actions will be taken;
            (C) whether a person can request that content be 
 blocked, removed, or modified, or that a user's service 
 be terminated, and how to make such a request;
            (D) a description of how a user will be notified of 
 and can respond to a request that his or her content be 
 blocked, removed, or modified, or service be 
 terminated, if such actions are taken;
        (E) whether a user who requested content be 
 blocked, removed, or modified will be notified of 
 whether action was taken as a result of the request, 
 the action that was taken, the reason why action was 
 taken or not taken, and how the user will be notified;
        (F) how a person can appeal a decision to block, 
 remove, or modify content, allow content to remain, or 
 terminate or not terminate service to a user, if such 
 actions are taken;
        (G) a description of how a user will be notified of 
 the result of the appeal;
        (H) a description of the tools and support 
 available to users who have experienced cyber 
 harassment; and
            (I) any other topic the Commission deems 
 appropriate.

    (2) For online marketplaces.--For online marketplaces, the 
 consumer protection policy required by subsection

    (a) shall 
 include--
        (A) a description of the products, product 
 descriptions, and marketing material, allowed or 
 disallowed on the marketplace;
        (B) whether a product, product descriptions, and 
 marketing material may be blocked, removed, or 
 modified, or if service to a user may be terminated and 
 the grounds upon which such actions will be taken;
            (C) whether users will be notified of products that 
 have been recalled or are dangerous, and how they will 
 be notified;
            (D) for users--
            (i) whether a user can report suspected 
 fraud, deception, dangerous products, or 
 violations of the online marketplace's terms of 
 service, and how to make such report;
            (ii) whether a user who submitted a report 
 will be notified of whether action was taken as 
 a result of the report, the action that was 
 taken and the reason why action was taken or 
 not taken, and how the user will be notified;
            (iii) how to appeal the result of a report;
            (iv) whether a user who appealed the result 
 of a report will be notified of whether action 
 was taken as a result of the appeal, the action 
 that was taken, the reason why action was taken 
 or not taken, and how the user will be 
 notified; and
            (v) under what circumstances a user is 
 entitled to refund, repair, or other remedy and 
 the remedy to which the user may be entitled, 
 how the user will be notified of such 
 entitlement, and how the user may claim such 
 remedy; and
        (E) for sellers--
            (i) how sellers are notified of a report by 
 a user or a violation of the terms of service 
 or consumer protection policy;
            (ii) how to contest a report by a user;
            (iii) how a seller who is the subject of a 
 report will be notified of what action will be 
 or must be taken as a result of the report and 
 the justification for such action;
            (iv) how to appeal a decision of the online 
 marketplace to take an action in response to a 
 user report or for a violation of the terms of 
 service or consumer protection policy; and
            (v) the policy regarding refunds, repairs, 
 replacements, or other remedies as a result of 
 a user report or a violation of the terms of 
 service or consumer protection policy.
            (c) Standard Short-Form Statements and Graphic Icons for Consumer 
Protection Practices.--

    (1) Study and report.--Not later than 180 days after the 
 date of the enactment of this Act, the Commission shall conduct 
 a study to determine the most effective method of communicating 
 common consumer protection practices in short-form consumer 
 disclosure statements or graphic icons that disclose the 
 consumer protection and content moderation practices of social 
 media platforms and online marketplaces. The Commission shall 
 submit a report to the Committee on Energy and Commerce of the 
 House of Representatives and the Committee on Commerce, 
 Science, and Transportation of the Senate with the results of 
 the study. The report shall also be made publicly available on 
 the website of the Commission.

    (2) Regulations.--Except as provided in paragraph

    (3) , 
 after completion of the study and not later than 1 year after 
 the date of the enactment of this Act, the Commission shall 
 finalize regulations based on the results of such study that 
 require social media platforms and online marketplaces to 
 communicate their consumer protection and content moderation 
 practices, and any other information as the Commission may 
 determine, in a clear and conspicuous manner.

    (3) Exception.--If the Commission determines, by a majority 
 vote of the Commissioners, that short-form consumer disclosure 
 statements or graphic icons will not advance consumer 
 understanding of consumer protection and content moderation 
 practices of social media platforms and online marketplaces, 
 the Commission shall include its reasoning for making that 
 determination in the report to Congress required by paragraph

    (1) and shall not finalize the rulemaking until it determines 
 such rules would advance consumer understanding of consumer 
 protection and content moderation practices of social media 
 platforms and online marketplaces.

SEC. 3. CONSUMER PROTECTION PROGRAM.

    (a) In General.--Each social media platform and online marketplace 
shall establish and implement a consumer protection program that 
includes policies, practices, and procedures regarding consumer 
protection and content moderation--

    (1) to--
        (A) ensure compliance with applicable Federal, 
 State, and local consumer protection laws;
        (B) develop, implement, and ensure compliance with 
 the terms of service required by 

section 2;
            (C) develop and implement policies regarding the 
 content and behavior permitted on its service both by 
 the platform and users, and ensure compliance with such 
 policies, practices and procedures;
            (D) mitigate risks that could be harmful to 
 consumers' safety, well-being, and reasonable 
 expectations of users of the social media platform or 
 online marketplace, including cyber harassment;
        (E) implement reasonable safeguards within, and 
 training and education of employees and contractors of, 
 the social media platform or online marketplace to 
 promote compliance with all consumer protection laws 
 and the consumer protection program; and
        (F) disclose any other requirement the Commission 
 deems appropriate; and

    (2) taking into consideration--
        (A) the size of, and the nature, scope, and 
 complexity of the activities engaged in by the social 
 media platform and online marketplace;
        (B) the activities engaged in by users on the 
 social media platform or online marketplace; and
            (C) the cost of implementing the program.

    (b) Additional Requirements.--As part of the consumer protection 
program, a social media platform or online marketplace shall--

    (1) establish processes to monitor, manage, and enforce the 
 social media platform's or online marketplace's consumer 
 protection program, and demonstrate the covered entity's 
 compliance with Federal, State, and local consumer protection 
 laws;

    (2) establish processes to assess and mitigate the risks to 
 individuals resulting from the social media platform's or 
 online marketplace's amplification of content or products not 
 in compliance with its terms of service;

    (3) establish a process to periodically review and update 
 the consumer protection program;

    (4) appoint a consumer protection officer, who reports 
 directly to the chief executive officer; and

    (5) establish and implement controls to monitor and 
 mitigate known or reasonably foreseeable risks to consumers 
 resulting from hosting content or products.
            (c) Annual Filings to the FTC.--

    (1) Filing requirements.--Each social media platform or 
 online marketplace that either has annual revenue in excess of 
 $250,000 in the prior year or that has more than 10,000 monthly 
 active users on average in the prior year, shall be required to 
 submit to the Commission, on an annual basis, a filing that 
 includes--
        (A) a detailed and granular description of each of 
 the requirements in 

section 2 and this section;
        (B) the name and contact information of the 
 consumer protection officer required under subsection

    (b)

    (4) ; and
            (C) a description of any material changes in the 
 consumer protection program or the terms of service 
 since the most recent prior disclosure to the 
 Commission.

    (2) Officer certification.--For each entity that submits an 
 annual filing under paragraph

    (1) , the entity's principal 
 executive officer and the consumer protection officer required 
 under subsection

    (b)

    (4) , shall be required to certify in each 
 such annual filing that--
        (A) the signing officer has reviewed the filing;
        (B) based on such officer's knowledge, the filing 
 does not contain any untrue statement of a material 
 fact or omit to state a material fact necessary to make 
 the statements, in light of the circumstances under 
 which such statements were made, not misleading;
            (C) based on such officer's knowledge, the filing 
 fairly presents in all material respects the consumer 
 protection practices of the social media platform or 
 online marketplace; and
            (D) the signing consumer protection officer--
            (i) is responsible for establishing and 
 maintaining safeguards and controls to protect 
 consumers and administer the consumer 
 protection program; and
            (ii) has provided all material conclusions 
 about the effectiveness of such safeguards and 
 controls.

    (3) Public availability.--The Commission shall make 
 publicly available on the website of the Commission the filings 
 submitted under paragraph

    (1) . The Commission may withhold 
 information included in such a filing if the Commission 
 determines such information should not be public. If the 
 Commission withholds any information, the Commission shall make 
 publicly available on the website the category of information 
 withheld and the reasons for withholding it.

SEC. 4. ENFORCEMENT.

    (a) Enforcement by Federal Trade Commission.--

    (1) Unfair or deceptive acts or practices.--Any violation 
 of this Act shall be treated as a violation of a regulation 
 under 

section 18

    (a)

    (1)
        (B) of the Federal Trade Commission Act 
 (15 U.S.C. 57a

    (a)

    (1)
        (B) ) regarding unfair or deceptive acts or 
 practices.

    (2) Powers of commission.--The Commission shall enforce 
 this Act in the same manner, by the same means, and with the 
 same jurisdiction, powers, and duties as though all applicable 
 terms and provisions of the Federal Trade Commission Act (15 
 U.S.C. 41 et seq.) were incorporated into and made a part of 
 this Act. Any person who violates this Act shall be subject to 
 the penalties and entitled to the privileges and immunities 
 provided in the Federal Trade Commission Act.

    (b) Regulations.--The Commission shall promulgate regulations under 

section 553 of title 5, United States Code, to carry out the purposes 
of this Act.
            (c) Private Right of Action.--

    (1) Enforcement by individuals.--
        (A) In general.--An individual alleging damages as 
 a result of a violation of this Act may bring a civil 
 action in any court of competent jurisdiction, State or 
 Federal.
        (B) Relief.--In a civil action brought under 
 subparagraph
        (A) in which the plaintiff prevails, the 
 court may award--
            (i) damages as provided in subparagraph
            (C) ;
            (ii) reasonable attorney's fees and 
 litigation costs; and
            (iii) any other relief, including equitable 
 or declaratory relief, that the court 
 determines appropriate.
            (C) Damages.--A prevailing plaintiff is entitled to 
 actual damages as a result of the violation of this 
 Act.

    (2) Invalidity of pre-dispute arbitration agreements and 
 pre-dispute joint-action waivers.--
        (A) In general.--Notwithstanding any other 
 provision of law, no pre-dispute arbitration agreement 
 or pre-dispute joint-action waiver shall be valid or 
 enforceable with respect to a dispute arising under 
 this Act.
        (B) Applicability.--Any determination as to whether 
 or how this paragraph applies to any dispute shall be 
 made by a court, rather than an arbitrator, without 
 regard to whether such agreement purports to delegate 
 such determination to an arbitrator.
            (C) === Definitions. ===
-In this paragraph:
            (i) Pre-dispute arbitration agreement.--The 
 term ``pre-dispute arbitration agreement'' 
 means any agreement to arbitrate a dispute that 
 has not arisen at the time of making the 
 agreement.
            (ii) Pre-dispute joint-action waiver.--The 
 term ``pre-dispute joint-action waiver'' means 
 an agreement, whether or not part of a pre-
 dispute arbitration agreement, that would 
 prohibit, or waive the right of, one of the 
 parties to the agreement to participate in a 
 joint, class, or collective action in a 
 judicial, arbitral, administration, or other 
 forum, concerning a dispute that has not yet 
 arisen at the time of making the agreement.
            (iii) Dispute.--The term ``dispute'' means 
 any claim related to an alleged violation of 
 this Act and between an individual and a 
 covered organization.
            (d) Enforcement by State Attorneys General.--

    (1) In general.--If the chief law enforcement officer of a 
 State, or an official or agency designated by a State, has 
 reason to believe that any person has violated or is violating 
 this Act, the attorney general, official, or agency of the 
 State, in addition to any authority it may have to bring an 
 action in State court under its consumer protection law, may 
 bring a civil action in any appropriate United States district 
 court or in any other court of competent jurisdiction, 
 including a State court, to--
        (A) enjoin further such violation by such person;
        (B) enforce compliance with this Act;
            (C) obtain civil penalties; and
            (D) obtain damages, restitution, or other 
 compensation on behalf of residents of the State.

    (2) Notice and intervention by the ftc.--The attorney 
 general of a State shall provide prior written notice of any 
 action under paragraph

    (1) to the Commission and provide the 
 Commission with a copy of the complaint in the action, except 
 in any case in which such prior notice is not feasible, in 
 which case the attorney general shall serve such notice 
 immediately upon instituting such action. The Commission shall 
 have the right--
        (A) to intervene in the action;
        (B) upon so intervening, to be heard on all matters 
 arising therein; and
            (C) to file petitions for appeal.

    (3) Limitation on state action while federal action is 
 pending.--If the Commission has instituted a civil action for 
 violation of this Act, no State attorney general, or official 
 or agency of a State, may bring an action under this subsection 
 during the pendency of that action against any defendant named 
 in the complaint of the Commission for any violation of this 
 Act alleged in the complaint.

    (4) Relationship with state-law claims.--If the attorney 
 general of a State has authority to bring an action under State 
 law directed at acts or practices that also violate this Act, 
 the attorney general may assert the State-law claim and a claim 
 under this Act in the same civil action.

SEC. 5. RELATIONSHIP TO OTHER LAWS.

    (a) Effect of Other Laws.--

Section 230 of the Communications Act of 
1934 (47 U.S.C. 230) shall not apply to any violation of this Act.

    (b) Effect on State Laws.--Nothing in this Act or any regulation 
promulgated under this Act shall preempt or otherwise affect any State 
or local law.
            (c) Severability.--If any provision of this Act, or the application 
thereof to any person or circumstance, is held invalid, the remainder 
of this Act and the application of such provision to other persons not 
similarly situated or to other circumstances shall not be affected by 
the invalidation.

SEC. 6. FTC ENFORCEMENT AUTHORITY.

    (a) In General.--

Section 230

    (e) of the Communications Act of 1934 
(47 U.S.C. 230

    (e) ) is amended by adding at the end the following:
 ``

    (6) No effect on ftc enforcement.--Nothing in this 
 section shall be construed to impair the enforcement by the 
 Federal Trade Commission of any provision of law enforced by 
 the Federal Trade Commission.''.

    (b) Applicability.--The amendment made by this section shall apply 
with respect to any action or proceeding that is commenced on or after 
the date of the enactment of this Act.

SEC. 7. DEFINITIONS.

 As used in this Act, the following definitions apply:

    (1) Commission.--The term ``Commission'' means the Federal 
 Trade Commission.

    (2) Consumer product.--The term ``consumer product'' has 
 the meaning given such term in 

section 3

    (a) of the Consumer 
 Product Safety Act (15 U.S.C. 2052

    (a) ).

    (3) Cyber harassment.--The term ``cyber harassment'' means 
 electronic communication that harasses, torments, threatens, or 
 terrorizes a target.

    (4) Online marketplace.--The term ``online marketplace'' 
 means a website or web application, that--
        (A) includes features that allow for, facilitate, 
 or enable third-party sellers to engage in the sale, 
 purchase, payment, storage, shipping, or delivery of a 
 consumer product in the United States; and
        (B) hosts one or more third-party sellers.

    (5) Seller.--The term ``seller'' means a person or entity 
 that sells, offers to sell, or contracts to sell a consumer 
 product through an online marketplace's platform.

    (6) Social media platform.--The term ``social media 
 platform'' means a website or mobile web application that--
        (A) permits a person to become a registered user, 
 establish an account, or create a profile for the 
 purpose of allowing the user to create, share, and view 
 user-generated content through such an account or 
 profile;
        (B) enables one or more users to generate content 
 that can be viewed by other users of the platform; and
            (C) primarily serves as a medium for users to 
 interact with content generated by other users of the 
 medium and for the platform to deliver ads to users.

    (7) User.--The term ``user'' means a person or entity that 
 uses a social media platform or online marketplace for any 
 purpose, including advertisers and sellers, regardless of 
 whether that person has an account or is otherwise registered 
 with the platform.
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