Online Consumer Protection Act
This bill, the Online Consumer Protection Act, would require social media platforms and online marketplaces to publish clear, machine-readable terms of service and a detailed consumer protection policy. It sets out what must be included in these terms and policies, and it creates a formal, ongoing consumer protection program within these platforms that addresses compliance with federal, state, and local laws, content moderation, cyber harassment, and risk mitigation. The bill gives the Federal Trade Commission broad enforcement authority to enforce these requirements, including a private right of action for individuals and the ability for states to prosecute violations. It also would prohibit pre-dispute arbitration and class-action waivers for disputes arising under the act, and it would amend other laws (notably Section 230) to preserve FTC enforcement powers. In short, the bill aims to increase transparency around terms of service and the way platforms moderate behavior and content, strengthen platforms’ internal compliance structures, and broaden avenues for consumer redress and enforcement, potentially expanding both regulatory oversight and litigation risk for large social media platforms and online marketplaces.
Key Points
- 1Terms of Service mandatory content and format
- 2- Platforms must establish, maintain, and publicly provide terms of service in a machine-readable format, covering service use, policies, and a required consumer protection policy, including topics such as payment methods, content ownership, third-party sharing, and notices/penalties.
- 3Consumer protection policy requirements
- 4- For social media platforms: must detail permitted/denied content and behavior, content/removal/modification/termination rules, user requests and responses, notification and appeal processes, and harassment support.
- 5- For online marketplaces: must describe product listings and marketing rules, recall/danger notifications, user reporting procedures and outcomes, and seller reporting/appeal processes, plus remedies and refunds.
- 6Creation of a robust consumer protection program
- 7- Platforms must implement policies, training, risk mitigation (including cyber harassment), and safeguarding controls; appoint a consumer protection officer; and tailor programs to platform size, scope, and costs.
- 8Annual FTC filings and officer certification
- 9- Eligible platforms must file annual disclosures describing their 2 and 3 programs, provide contact information for the protection officer, and note material changes; senior executives and the protection officer must certify the accuracy and completeness of these filings; filings become public by default.
- 10Short-form disclosures and rulemaking
- 11- The FTC must study and propose short-form statements or icons to communicate protection practices; if finalized, platforms must use clear disclosures to communicate practices (with a possible delay if the FTC determines these would not help consumers).
- 12Enforcement and private rights
- 13- Violations are treated as unfair or deceptive acts or practices under the FTC Act, with FTC enforcement parallel to other FTC authorities; individuals may sue for damages, attorney’s fees, and other relief; pre-dispute arbitration and class-action waivers are invalid for disputes under this Act.
- 14State role and intergovernmental coordination
- 15- State attorneys general can bring actions to enforce the Act, with notice to the FTC; actions against a platform under this Act suspend parallel state actions during federal enforcement, and state claims may be brought alongside this Act in a single case.
- 16Relationship to existing laws
- 17- Section 230 of the Communications Act would not apply to violations of this Act; however, the act does not preempt state or local laws and includes severability provisions.
- 18FTC authority and cross-cutting changes
- 19- The Act would amend Section 230 to preserve FTC enforcement rights; it creates a framework under which the FTC can regulate and enforce compliance with the new requirements.