#1. Expanding rulemaking powers of the Federal Trade Commission (FTC) 

What’s so AWFUL?   Expanded powers would let the FTC threaten online business models that support free sites and services.

The Wall Street Reform and Consumer Protection Act of 2009 (HR 4173) would increase the FTC’s rulemaking authority, removing significant procedural safeguards that have existed for over thirty years. When Congress passed the Magnuson-Moss Act in 1975, it recognized that the FTC’s exceptionally broad consumer protection powers over unfair or deceptive commerce must be tempered by a more transparent rulemaking process.

But HR 4173 would strip away these protections, opening the door to a new regulation agenda and reducing the checks and balances of the current rulemaking process. FTC officials have publicly signaled their desire to regulate what’s “fair” between online businesses and users through increased enforcement of the “unfair” part of Section 5 of the FTC Act, which prohibits unfair or deceptive practices. New rules could turn upside-down existing practices based on notice and choice, and make it an unfair act for people to give consent to data practices, often in exchange for free services.

NetChoice posts on this topic:  

  FTC Authority Grab Troubling for Consumers and Competition

  Beyond Privacy Policies to Policy Prescription: The New Unfairness Doctrine at the FTC

  Making A Federal Case out of Facebook’s Customer Relations

 

[1]Emphasis added.

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