Schatz Sounds Alarm of Privacy Oversight Void as Flake Preps ISP Privacy CRA Resolution

Sen. Jeff Flake, R-Ariz., confirmed he’s preparing a Congressional Review Act (CRA) resolution of disapproval to dismantle the FCC’s ISP privacy rules, a possibility he and other Republican lawmakers had said was on the table (see 1701090062). The tool would prevent the FCC from developing similar rules in the future and requires only a simple majority in the Senate. Capitol Hill Democrats and public interest groups objected to using the CRA to kill the rules.

“We’re trying to line up support, but yeah, we’re likely to do it,” said Flake, who chairs the Judiciary Privacy Subcommittee and held a hearing last year on the rules, in an interview Wednesday. “It would just move the process more quickly." He and his spokespeople declined on multiple occasions earlier this year to say whether he would file such a resolution.

“The FCC's midnight regulation does nothing to protect consumer privacy," Flake said in a statement after the interview. "It is unnecessary, confusing and adds yet another innovation-stifling regulation to the internet. My legislation is the first step toward restoring the FTC's light-touch, consumer-friendly approach. It will not change or lessen existing consumer privacy protections. It empowers consumers to make informed choices on if and how their data can be shared. It has strong and growing support in both the Senate and the House, and I look forward to introducing it soon.”

Senate Communications Subcommittee ranking member Brian Schatz, D-Hawaii, offered a sharp warning against the CRA’s use Wednesday, speaking during an Incompas meeting in Washington.

“Nobody that I know thinks that the FTC and the FCC shouldn’t have jurisdiction but that is where we’ll end up after that CRA,” Schatz said. “And that’s pretty scary. And I don’t think that’s going to be good for business.” He cited the 9th U.S. Circuit Court of Appeals' ruling that the FTC lacked jurisdiction over AT&T in a data throttling case as a crucial and dangerous element in the CRA scenario, given the possibility it would prevent the FTC from acting in a post-CRA world if the ruling isn't overturned.

“Troubling,” FTC Commissioner Terrell McSweeny tweeted Wednesday of reports of Flake’s CRA. “Rolling back @FCC privacy rule will leave consumers unprotected & with fewer choices re sensitive data.”

Some ISP officials argue the CRA wouldn't create a gap in privacy oversight. They point to the ongoing relevance of Communications Act Section 222, which the FCC would still have as a basis of authority even absent its implementing rules (see 1702090070). If the FCC or Congress undoes the Communications Act Title II reclassification of broadband as implemented in the FCC’s open internet order, the FTC could play a bigger enforcement role in privacy. But the details of such enforcement are complicated by the 9th Circuit ruling, creating concerns that Schatz referred to.

In the House, Commerce Committee Chairman Greg Walden, R-Ore., and Communications Subcommittee Chairman Marsha Blackburn, R-Tenn., said a CRA filing is likely and Blackburn said one could be filed in the House as early as this week (see 1702070074), which hasn't happened. Walden said Tuesday he sees no rush, particularly for House lawmakers.

Flake didn’t rule out the possibility he may be ready to file the CRA before next week’s recess: “We’re still not sure,” he told us when asked about the possibility. His office is “still discussing” timing for filing a Senate resolution, he said. Senate Commerce Committee Chairman John Thune, R-S.D., said early this month the Senate would “likely process” such a CRA but expected it to originate in the House (see 1702010051). Walden said there was debate about which chamber would act first (see 1701310071).

“The quickest and most efficient way to undo the FCC’s privacy rules is through Congress’ ability to use the Congressional Review Act," the U.S. Chamber of Commerce wrote in a recent blog post, identifying Section 222 as an acceptable authority remaining for FCC enforcement.

“That thing is rolling down the hill very fast,” Schatz cautioned of the CRA. “The other opportunity might be to legislate in that space. … There is a simple solution there, which is that the legislative branch comes in with a fix.” Details would be “very thorny” but if there were no functioning privacy regulator, Schatz said he believes a “functioning Congress would then step into the fray.”