Senate Privacy, Spam Bills Both Likely Canned Till Next Year

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Though a proposed anti-spam bill has a better chance of passing in the full Senate, neither it nor an online privacy bill from an influential senator are likely to pass this year, the Direct Marketing Association said last week.


"I don't think either of them, because of time, can pass the Senate this year," said Jim Conway, vice president of government relations at the DMA. "Next year, of course, is a different story."


In a move would have a major effect on direct marketers, the privacy bill was amended to include a requirement to have the Federal Trade Commission draft privacy rules for offline data collection as well. If the FTC failed to act within one year of the bill's enactment, the online rules would apply to bricks-and-mortar businesses.


The bills were both passed by the Senate Commerce Committee May 17 and are headed to the full Senate, though it is unclear when they will reach the floor because the more-pressing Senate Appropriations bill.


Sen. Conrad Burns, R-MT and Sen. Ron Wyden, D-OR, introduced the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2001, or the CAN SPAM bill. It passed the committee unanimously. The bill would require companies to include a working return address to allow recipients to refuse further e-mails and give Internet service providers the ability to sue to keep spam out of their networks.


The committee also approved a separate amendment that would prohibit transmitting unwanted e-mails to addresses that were illegally obtained from Web sites. The bill also would give the Federal Trade Commission the authority to impose fines of up to $10 per e-mail violation with a cap of $500,000.


The Online Personal Privacy Act of 2002, which was introduced April 18 by committee chairman Sen. Ernest "Fritz" Hollings, D-SC, was approved by the committee 15-8.


The bill would require any company with an online presence to obtain opt-in consent from consumers for sensitive data and provide opt-out options for other data. The sensitive information includes financial data, medical records, Social Security numbers, religious affiliation and sexual orientation. Non-sensitive information would include transactional data from online purchases. Other provisions would:


* Let consumers sue companies if sensitive data were misused reduced the maximum amount they could win in lawsuits for privacy violations from $5,000 to $500.


Reduce the maximum amount consumers could win in lawsuits for privacy violations from $5,000 to $500.


* Exempt Internet businesses with 25 or fewer employees.


Of the two bills, the one from Hollings is up against tougher opposition, said Conway, who called it, "a wide stroke of the brush" because of the online-offline mix. Though the DMA opposes both, he was pleased with some of the changes made to the CAN SPAM bill.


"We have worked with Sen. Burns and Sen. Wyden very positively, very productively, and we are pleased [that] even though we can't support it, that a number of thoughtful changes have been made in terms of our industry," Conway said.


Some of the changes include preemption of the state spam laws, recognition that it won't apply to commercial e-mail to existing customers, and prevention of private class-action lawsuits.


Business groups including the Direct Marketing Association and the U.S. Chamber of Commerce and senators such as Lott and John McCain, R-AZ, have been vocal in opposing the bill.


Meanwhile, Reuters reported Friday that the anti-spam bill passed by the committee would give the Federal Trade Commission the authority to impose fines of up to $10 per e-mail on e-mails that violate existing spam -- with a cap of $500,000. Twenty-two states have passed anti-spam legislation. The bill heads to the full Senate as well.


The committee also approved a separate amendment that would prohibit transmitting unwanted e-mails to addresses that were illegally obtained from Web sites. The proposal would require companies to include a working return address to allow recipients to refuse further e-mails and give Internet service providers the ability to sue to keep spam out of their networks.


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