[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3816 Reported in House (RH)]
<DOC>
Union Calendar No. 475
117th CONGRESS
2d Session
H. R. 3816
[Report No. 117-655]
To provide that certain discriminatory conduct by covered platforms
shall be unlawful, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
June 11, 2021
Mr. Cicilline (for himself, Mr. Gooden of Texas, Mr. Nadler, and Mr.
Buck) introduced the following bill; which was referred to the
Committee on the Judiciary
December 21, 2022
Additional sponsors: Mr. Jones, Mr. Johnson of Georgia, Mr. Raskin, Ms.
Jayapal, Ms. Scanlon, Mr. Neguse, Mrs. McBath, Mrs. Trahan, Mr.
Cawthorn, Mr. Donalds, Mr. Gosar, Mr. Garcia of Illinois, Mr. Levin of
Michigan, Ms. Tlaib, Mr. Espaillat, Mr. Babin, Mr. Mast, Mrs. Miller-
Meeks, Ms. Newman, Ms. Porter, Ms. Pingree, Mr. Hice of Georgia, Mr.
Jeffries, Ms. Omar, Ms. Lee of California, Mr. Mfume, Mrs. Bustos, Mrs.
Demings, Ms. Dean, Ms. Escobar, Ms. Schakowsky, Ms. Houlahan, Mrs.
Cherfilus-McCormick, Ms. Castor of Florida, Ms. Craig, Mrs. Lawrence,
Ms. Wild, Mr. Perlmutter, Mr. Morelle, Mr. Payne, Mrs. Watson Coleman,
Ms. Chu, Mr. DeSaulnier, and Mr. DeFazio
December 21, 2022
Reported with amendments, committed to the Committee of the Whole House
on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed
in italic]
[For text of introduced bill, see copy of bill as introduced on June
11, 2021]
_______________________________________________________________________
A BILL
To provide that certain discriminatory conduct by covered platforms
shall be unlawful, and for other purposes.
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 ``American Innovation and Choice
Online Act''.
SEC. 2. UNLAWFUL DISCRIMINATORY CONDUCT.
(a) Violation.--It shall be unlawful for a person operating a
covered platform, in or affecting commerce, to engage in any conduct in
connection with the operation of the covered platform that--
(1) advantages the covered platform operator's own
products, services, or lines of business over those of another
business user;
(2) excludes or disadvantages the products, services, or
lines of business of another business user relative to the
covered platform operator's own products, services, or lines of
business; or
(3) discriminates among similarly situated business users,
including, but not limited to, those business users employed by
businesses owned by women and minorities.
(b) Other Discriminatory Conduct.--It shall be unlawful for a
person operating a covered platform, in or affecting commerce, to--
(1) restrict or impede the capacity of a business user to
access or interoperate with the same platform, operating
system, hardware or software features that are available to the
covered platform operator's own products, services, or lines of
business;
(2) condition access to the covered platform or preferred
status or placement on the covered platform on the purchase or
use of other products or services offered by the covered
platform operator;
(3) use non-public data to offer, or support the offering
of, the covered platform operator's own products, services, or
lines of business that are obtained from or generated on the
covered platform--
(A) by the activities of a business user; or
(B) through an interaction of a covered platform
user with the products or services of a business user;
(4) restrict or impede a business user from accessing data
generated on the covered platform by the activities of the
business user, or through an interaction of a covered platform
user with the business user's products or services, such as by
establishing contractual or technical restrictions that prevent
the portability of such data by the business user to other
systems or applications;
(5) restrict or impede covered platform users from un-
installing software applications that have been preinstalled on
the covered platform or changing default settings that direct
or steer covered platform users to products or services offered
by the covered platform operator;
(6) restrict or impede businesses users from communicating
information or providing hyperlinks on the covered platform to
covered platform users to facilitate business transactions;
(7) in connection with any user interface, including search
or ranking functionality offered by the covered platform, treat
the covered platform operator's own products, services, or
lines of business more favorably than those of another business
user;
(8) interfere with or restrict a business user's pricing of
its products or services;
(9) restrict or impede a business user, or a business
user's customers or users, from interoperating or connecting to
any product or service; or
(10) retaliate against any person that raises concerns with
any law enforcement authority about actual or potential
violations of State or Federal law or that initiates or
participates in litigation to enforce this Act.
(c) Affirmative Defense.--Subsections (a) and (b) shall not apply
if the defendant establishes by clear and convincing evidence that the
conduct described in subsections (a) or (b)--
(1) would not result in harm to the competitive process by
restricting or impeding legitimate activity by business users;
or
(2) was narrowly tailored, could not be achieved through
less discriminatory means, was nonpretextual, and was necessary
to--
(A) prevent a violation of, or comply with, Federal
or State law; or
(B) protect user privacy or other non-public data;
or
(3) increases consumer welfare.
(d) Covered Platform Designation.--The Federal Trade Commission or
Department of Justice shall designate a covered platform for the
purpose of implementing and enforcing this Act. Such designation
shall--
(1) be based on a finding that the criteria set forth in
subsection (g)(4)(i)-(iii) are met;
(2) be issued in writing and published in the Federal
Register; and
(3) apply for 10 years from its issuance regardless of
whether there is a change in control or ownership over the
covered platform unless the Commission or the Department of
Justice removes the designation under subsection (e).
(e) Removal of Covered Platform Designation.--The Commission or the
Department of Justice shall--
(1) consider whether its designation of a covered platform
under subsection (d) should be removed prior to the expiration
of the ten-year period if the covered platform operator files a
request with the Commission or the Department of Justice, which
shows that the online platform no longer meets the criteria set
forth in subsection (g)(4)(i)-(iii);
(2) determine whether to grant a request submitted under
paragraph 1 not later than 120 days after the date of the
filing of such request; and
(3) obtain the concurrence of the Commission or the
Department of Justice, as appropriate, before granting a
request submitted under paragraph (1).
(f) Remedies.--
(1) Civil penalty.--Any covered platform operator who is
found to have violated subsections (a) or (b) shall be liable
to the United States or the Commission for a civil penalty,
which shall accrue to the United States Treasury, in an amount
not more than the greater of--
(A) 15 percent of the total United States revenue
of the person for the previous calendar year; or
(B) 30 percent of the United States revenue of the
person in any line of business affected or targeted by
the unlawful conduct during the period of the unlawful
conduct. This civil penalty may be recovered in a civil
action brought by the United States or the Commission.
(2) Remedies in addition.--Remedies provided in this
subsection are in addition to, and not in lieu of, any other
remedy available under Federal or State law.
(A) Restitution; contract rescission and
reformation; refunds; return of property.--The
Assistant Attorney General of the Antitrust Division,
the Commission, or the attorney general of any State
may seek, and the court may order, with respect to a
violation that gives rise to the suit, restitution for
losses, rescission or reformation of contracts, refund
of money, or return of property.
(B) Disgorgement.--The Assistant Attorney General
of the Antitrust Division, the Commission, or the
attorney general of any State may seek, and the court
may order, disgorgement of any unjust enrichment that a
covered platform operator obtained as a result of the
violation that gives rise to the suit.
(C) Injunctions.--The Assistant Attorney General of
the Antitrust Division, the Commission, or the attorney
general of any State may seek, and the court may order,
relief in equity as necessary to prevent, restrain, or
prohibit violations of this Act.
(D) Conflict of interest.--
(i) If the fact finder determines that a
violation of this Act arises from a conflict of
interest related to the covered platform
operator's ownership or control of multiple
lines of business, the court shall consider
requiring, and may order, divestiture of the
line or lines of business that give rise to
such conflict.
(ii) For purposes of this section, the term
``conflict of interest'' includes the conflict
of interest that arises when--
(I) a covered platform operator
owns or controls a line of business,
other than the covered platform; and
(II) the covered platform
operator's ownership or control of that
line of business creates the incentive
and ability for the covered platform
operator to--
(aa) advantage the covered
platform operator's own
products, services, or lines of
business on the covered
platform over those of a
competing business or a
business that constitutes
nascent or potential
competition to the covered
platform operator; or
(bb) exclude from, or
disadvantage, the products,
services, or lines of business
on the covered platform of a
competing business or a
business that constitutes
nascent or potential
competition to the covered
platform operator.
(3) Repeat offenders.--If the fact finder determines that a
covered platform operator has engaged in a pattern or practice
of violating this Act, the court shall consider requiring, and
may order, that the Chief Executive Officer, and any other
corporate officer as appropriate to deter violations of this
Act, forfeit to the United States Treasury any compensation
received by that person during the 12 months preceding or
following the filing of a complaint for an alleged violation of
this Act.
(g) Definitions.--In this section:
(1) Antitrust laws.--The term ``antitrust laws'' has the
meaning given the term in subsection (a) of section 1 of the
Clayton Act (15 U.S.C. 12).
(2) Business user.--The term ``Business User'' means a
person that utilizes or plans to utilize the covered platform
for the sale or provision of products or services.
(3) Commission.--The term ``Commission'' means the Federal
Trade Commission.
(4) Covered platform.--The term ``covered platform'' means
an online platform--
(A) that has been designated as a ``covered
platform'' under section 2(d); or
(B) that--
(i) at any point during the 12 months
preceding a designation under section 2(d) or
at any point during the 12 months preceding the
filing of a complaint for an alleged violation
of this Act--
(I) has at least 50,000,000 United
States-based monthly active users on
the online platform; or
(II) has at least 100,000 United
States-based monthly active business
users on the online platform;
(ii) at any point during the 2 years
preceding a designation under section 2(d) or
at any point during the 2 years preceding the
filing of a complaint for an alleged violation
of this Act, is owned or controlled by a person
with United States net annual sales or a market
capitalization greater than $600,000,000,000,
adjusted for inflation on the basis of the
Consumer Price Index; and
(iii) is a critical trading partner for the
sale or provision of any product or service
offered on or directly related to the online
platform.
(5) Critical trading partner.--The term ``critical trading
partner'' means an entity that has the ability to restrict or
impede the access of--
(A) a business user to its users or customers; or
(B) a business user to a tool or service that it
needs to effectively serve its users or customers.
(6) Person.--The term ``person'' has the meaning given the
term in subsection (a) of section 1 of the Clayton Act (15
U.S.C. 12).
(7) Data.--
(A) In general.--Not later than 6 months after the
date of enactment of this Act, the Commission shall
adopt rules in accordance with section 553 of title 5,
United States Code, to define the term ``data'' for the
purpose of implementing and enforcing this Act.
(B) Data.--The term ``data'' shall include
information that is collected by or provided to a
covered platform or business user that is linked, or
reasonably linkable, to a specific--
(i) user or customer of the covered
platform; or
(ii) user or customer of a business user.
(8) Online platform.--The term ``online platform'' means a
website, online or mobile application, operating system,
digital assistant, or online service that--
(A) enables a user to generate content that can be
viewed by other users on the platform or to interact
with other content on the platform;
(B) facilitates the offering, sale, purchase,
payment, or shipping of products or services, including
software applications, between and among consumers or
businesses not controlled by the platform operator; or
(C) enables user searches or queries that access or
display a large volume of information.
(9) Control.--The term ``control'' with respect to a person
means--
(A) holding 25 percent or more of the stock of the
person;
(B) having the right to 25 percent or more of the
profits of the person;
(C) having the right to 25 percent or more of the
assets of the person, in the event of the person's
dissolution;
(D) if the person is a corporation, having the
power to designate 25 percent or more of the directors
of the person;
(E) if the person is a trust, having the power to
designate 25 percent or more of the trustees; or
(F) otherwise exercises substantial control over
the person.
(10) State.--The term ``State'' means a State, the District
of Columbia, the Commonwealth of Puerto Rico, and any other
territory or possession of the United States.
(h) Enforcement.--
(1) In general.--Except as otherwise provided in this Act--
(A) 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 of the Federal Trade Commission Act
(15 U.S.C. 41 et seq.) were incorporated into and made
a part of this Act;
(B) the Attorney General 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 of the Sherman Act (15 U.S.C. 1 et
seq.), Clayton Act (15 U.S.C. 12 et seq.), and
Antitrust Civil Process Act (15 U.S.C. 1311 et seq.)
were incorporated into and made a part of this Act; and
(C) any attorney general of a State 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 of the Sherman Act (15 U.S.C. 1 et
seq.) and the Clayton Act (15 U.S.C. 12 et seq.) were
incorporated into and made a part of this Act.
(2) Unfair methods of competition.--A violation of this Act
shall also constitute an unfair method of competition under
section 5 of the Federal Trade Commission Act (15 U.S.C. 45).
(3) Commission independent litigation authority.--If the
Commission has reason to believe that a person violated this
Act, the Commission may commence a civil action, in its own
name by any of its attorneys designated by it for such purpose,
to recover a civil penalty and seek other appropriate relief in
a district court of the United States.
(4) Parens patriae.--Any attorney general of a State may
bring a civil action in the name of such State for a violation
of this Act as parens patriae on behalf of natural persons
residing in such State, in any district court of the United
States having jurisdiction of the defendant, and may secure any
form of relief provided for in this section.
(i) Emergency Relief.--
(1) The Commission, Assistant Attorney General of the
Antitrust Division, or any attorney general of a State may seek
a temporary injunction requiring the covered platform operator
to take or stop taking any action for not more than 120 days
and the court shall grant such relief if the Commission, the
United States, or the attorney general of a State proves--
(A) there is a plausible claim that a covered
platform operator took an action that violates this
Act; and
(B) that action impairs the ability of at least 1
business user to compete with the covered platform
operator.
(2) The emergency relief shall not last more than 120 days
from the filing of the complaint.
(3) The court shall terminate the emergency relief at any
time that the covered platform operator proves that the
Commission, the United States, or the attorney general of the
State seeking relief under this section has not taken
reasonable steps to investigate whether a violation has
occurred.
(4) Nothing in this subsection prevents or limits the
Commission, the United States, or any attorney general of any
State from seeking other equitable relief as provided in
subsection (f) of this section.
(j) Statute of Limitations.--A proceeding for a violation of this
section may be commenced not later than 6 years after such violation
occurs.
SEC. 3. JUDICIAL REVIEW.
(a) In General.--Any party that is subject to a covered platform
designation under section 2(d) of this Act, a decision in response to a
request to remove a covered platform designation under section 2(e) of
this Act, a final order issued in any district court of the United
States under this Act, or a final order of the Commission issued in an
administrative adjudicative proceeding under this Act may within 30
days of the issuance of such designation, decision, or order, petition
for review of such designation, decision, or order in the United States
Court of Appeals for the District of Columbia Circuit.
(b) Treatment of Findings.--In a proceeding for judicial review of
a covered platform designation under section 2(d) of this Act, a
decision in response to a request to remove a covered platform
designation under section 2(e) of this Act, or a final order of the
Commission issued in an administrative adjudicative proceeding under
this Act, the findings of the Commission or the Assistant Attorney
General as to the facts, if supported by evidence, shall be conclusive.
SEC. 4. BUREAU OF DIGITAL MARKETS.
(a) Establishment of Bureau.--As soon as practicable, but not later
than 180 days after the date of enactment of this Act, the Commission
shall establish within the Commission a bureau of digital markets for
purposes of enforcement of this Act.
(b) Leadership.--The head of the Bureau of Digital Markets shall be
the Director of the Bureau of Digital Markets, who shall--
(1) report directly to the Chair of the Commission; and
(2) be appointed by the Chair of the Commission.
(c) Bureau Staff.--The Bureau of Digital Markets shall retain or
employ legal, technology, economic, research, and service staff
sufficient to carry out the functions, powers, and duties of the
Bureau.
(d) Reporting Requirement.--Not later than 1 year after the date of
enactment of this Act, the Bureau of Digital Markets shall on an annual
basis publish and submit a report to the Committee on the Judiciary of
the House of Representatives and the Committee on the Judiciary of the
Senate describing the Bureau's enforcement activities during the
previous 12-month period.
SEC. 5. ENFORCEMENT GUIDELINES.
(a) In General.--Not later than 1 year after the date of enactment
of this Act, the Commission and the Assistant Attorney General of the
Antitrust Division shall jointly issue guidelines outlining policies
and practices, relating to agency enforcement of this Act, with the
goal of promoting transparency and deterring violations.
(b) Updates.--The Commission and the Assistant Attorney General of
the Antitrust Division shall update the joint guidelines issued under
subsection (a), as needed to reflect current agency policies and
practices, but not less frequently than once every 4 years beginning on
the date of enactment of this Act.
(c) Operation.--The Joint Guidelines issued under this section do
not confer any rights upon any person, State, or locality, nor shall
they operate to bind the Commission, Department of Justice, or any
person, State, or locality to the approach recommended in such
Guidelines.
SEC. 6. SUITS BY PERSONS INJURED.
(a) In General.--Except as provided in subsection (b), any person
who shall be injured in his business or property by reason of anything
forbidden in this Act may sue therefor in any district court of the
United States in the district in which the defendant resides or is
found or has an agent, without respect to the amount in controversy,
and shall recover threefold the damages by him sustained, and the cost
of suit, including a reasonable attorney's fee. The court may award
under this section, pursuant to a motion by such person promptly made,
simple interest on actual damages for the period beginning on the date
of service of such person's pleading setting forth a claim under this
Act and ending on the date of judgment, or for any shorter period
therein, if the court finds that the award of such interest for such
period is just in the circumstances. In determining whether an award of
interest under this section for any period is just in the
circumstances, the court shall consider only--
(1) whether such person or the opposing party, or either
party's representative, made motions or asserted claims or
defenses so lacking in merit as to show that such party or
representative acted intentionally for delay, or otherwise
acted in bad faith;
(2) whether, in the course of the action involved, such
person or the opposing party, or either party's representative,
violated any applicable rule, statute, or court order providing
for sanctions for dilatory behavior or otherwise providing for
expeditious proceedings; and
(3) whether such person or the opposing party, or either
party's representative, engaged in conduct primarily for the
purpose of delaying the litigation or increasing the cost
thereof.
(b) Amount of Damages Payable to Foreign States and
Instrumentalities of Foreign States.--
(1) Except as provided in paragraph (2), any person who is
a foreign state may not recover under subsection (a) an amount
in excess of the actual damages sustained by it and the cost of
suit, including a reasonable attorney's fee.
(2) Paragraph (1) shall not apply to a foreign state if--
(A) such foreign state would be denied, under
section 1605(a)(2) of title 28, immunity in a case in
which the action is based upon a commercial activity,
or an act, that is the subject matter of its claim
under this section;
(B) such foreign state waives all defenses based
upon or arising out of its status as a foreign state,
to any claims brought against it in the same action;
(C) such foreign state engages primarily in
commercial activities; and
(D) such foreign state does not function, with
respect to the commercial activity, or the act, that is
the subject matter of its claim under this section as a
procurement entity for itself or for another foreign
state.
(c) Injunctive Relief.--Any person shall be entitled to sue for and
have injunctive relief, in any court of the United States having
jurisdiction over the parties, against threatened loss or damage by a
violation of this Act, when and under the same conditions and
principles as injunctive relief against threatened conduct that will
cause loss or damage is granted by courts of equity, under the rules
governing such proceedings, and upon the execution of proper bond
against damages for an injunction improvidently granted and a showing
that the danger of irreparable loss or damage is immediate, a
preliminary injunction may issue: Provided, That nothing herein
contained shall be construed to entitle any person, except the United
States, to bring suit for injunctive relief against any common carrier
subject to the jurisdiction of the Surface Transportation Board under
subtitle IV of title 49. In any action under this section in which the
plaintiff substantially prevails, the court shall award the cost of
suit, including a reasonable attorney's fee, to such plaintiff.
SEC. 7. RULE OF CONSTRUCTION.
(a) Notwithstanding any other provision of law, whether user
conduct would constitute a violation of section 1030 of title 18 of the
United States Code is not dispositive of whether the defendant has
established an affirmative defense under this Act.
(b) An action taken by a covered platform operator that is
reasonably tailored to protect the rights of third parties under
sections 106, 1101, 1201, or 1401 of title 17 of the United States Code
or rights actionable under sections 32 or 43 of the Lanham Act (15
U.S.C. Sec. Sec. 1114, 1125), or corollary state law, shall not be
considered unlawful conduct under subsection 2(a) or (b) of this Act.
(c) Nothing in this Act shall be construed to limit any authority
of the Attorney General or the Commission under the antitrust laws, the
Federal Trade Commission Act (15 U.S.C. 45), or any other provision of
law or to limit the application of any law.
SEC. 8. SEVERABILITY.
If any provision of this Act, an amendment made by this Act, or the
application of such provision or amendment to any person or
circumstance is held to be unconstitutional, the remainder of this Act
and of the amendments made by this Act, and the application of the
remaining provisions of this Act and amendments to any person or
circumstance shall not be affected.
Amend the title so as to read: ``A bill to provide that
certain discriminatory conduct by a covered platform operator
shall be unlawful, and for other purposes.''.
Union Calendar No. 475
117th CONGRESS
2d Session
H. R. 3816
[Report No. 117-655]
_______________________________________________________________________
A BILL
To provide that certain discriminatory conduct by covered platforms
shall be unlawful, and for other purposes.
_______________________________________________________________________
December 21, 2022
Reported with amendments, committed to the Committee of the Whole House
on the State of the Union, and ordered to be printed