On December 11 2017, the Federal Trade Commission and Federal Communications Commission announced their intent to enter into a Memorandum of Understanding under which the two agencies would allocate enforcement responsibilities following the adoption of the Restoring Internet Freedom Order.
“The Memorandum of Understanding will be a critical benefit for online consumers because it outlines the robust process by which the FCC and FTC will safeguard the public interest,” said FCC Chairman Ajit Pai. “Instead of saddling the Internet with heavy-handed regulations, we will work together to take targeted action against bad actors. This approach protected a free and open Internet for many years prior to the FCC’s 2015 Title II Order and it will once again following the adoption of the Restoring Internet Freedom Order.”
“The FTC is committed to ensuring that Internet service providers live up to the promises they make to consumers,” said Acting FTC Chairman Maureen K. Ohlhausen. “The MOU we are developing with the FCC, in addition to the decades of FTC law enforcement experience in this area, will help us carry out this important work.”
The draft MOU sets forth numerous ways in which the FCC and FTC will work together to protect consumers.
For example, the FCC will review informal complaints concerning ISP compliance with the disclosure obligations set forth in the new transparency rule. The foregoing obligations include publicly providing information concerning an ISP’s practices with respect to blocking, throttling, paid prioritization and congestion management.
If an ISP fails to make the required disclosures the FCC may initiate enforcement action.
The FTC will investigate and take enforcement action against ISPs concerning the accuracy of the aforementioned disclosures, as well as other deceptive or unfair acts or practices involving their broadband services.
The FCC and the FTC will broadly share legal and technical expertise, including the secure sharing of informal complaints regarding the subject matter of the Restoring Internet Freedom Order. The two agencies also will collaborate on consumer and industry outreach and education.
The FCC is expected to vote on the proposed Restoring Internet Freedom Order at its December 14 meeting. If adopted, it will reverse a 2015 decision to reclassify broadband Internet access service as a Title II common carrier service. The previous decision stripped the FTC of its authority to protect consumers and promote competition with respect to Internet service providers because the FTC does not have jurisdiction over common carrier activities.
The FCC’s Restoring Internet Freedom Order would return jurisdiction to the FTC to police the conduct of ISPs, including their privacy practices.
If adopted, the order will also require broadband Internet access service providers to disclose their network management practices, performance and commercial terms of service.
Richard B. Newman is an Internet marketing compliance and regulatory defense attorney at Hinch Newman LLP focusing on advertising and digital media matters. His practice includes conducting legal compliance reviews of advertising campaigns, representing clients in investigations and enforcement actions brought by the Federal Trade Commission and state Attorneys General, commercial litigation, advising clients on promotional marketing programs, and negotiating and drafting legal agreements.
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