Honest Ads Act

II 116TH CONGRESS 1ST SESSION S. 1356 To enhance transparency and accountability for online political advertisements by requiring those who purchase and publish such ads to disclose infor- mation about the advertisements to the public, and for other purposes. IN THE SENATE OF THE UNITED STATES MAY 7, 2019 Ms. KLOBUCHAR (for herself, Mr. GRAHAM, and Mr. WARNER) introduced the following bill; which was read twice and referred to the Committee on Rules and Administration A BILL To enhance transparency and accountability for online polit- ical advertisements by requiring those who purchase and publish such ads to disclose information about the adver- tisements to the public, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Honest Ads Act’’. 4 SEC. 2. PURPOSE. 5 The purpose of this Act is to enhance the integrity 6 of American democracy and national security by improving 7 disclosure requirements for online political advertisements 8 VerDate Sep 11 2014 23:47 May 13, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1356.IS S1356 pamtmann on DSKBFK8HB2PROD with BILLS 2 •S 1356 IS in order to uphold the United States Supreme Court’s 1 well-established standard that the electorate bears the 2 right to be fully informed. 3 SEC. 3. FINDINGS. 4 Congress makes the following findings: 5 (1) On April 18, 2019, Special Counsel Robert 6 Mueller released a report titled ‘‘Report on the In- 7 vestigation into Russian Interference in the 2016 8 Presidential Election’’, which concluded that ‘‘the 9 Russian government interfered in the 2016 presi- 10 dential election in sweeping and systemic fashion.’’. 11 The report details that Russia interfered in the 2016 12 presidential election principally through two oper- 13 ations: first, through a Russian government spon- 14 sored social media influence campaign, and second, 15 by Russian intelligence ‘‘computer-intrusion’’ oper- 16 ations against those associated with both presi- 17 dential campaigns. 18 (2) On September 6, 2017, the Nation’s largest 19 social media platform disclosed that between June 20 2015 and May 2017, Russian entities purchased 21 $100,000 in political advertisements, publishing 22 roughly 3,000 ads linked to fake accounts associated 23 with the Internet Research Agency, a pro-Kremlin 24 organization. According to the company, the ads 25 VerDate Sep 11 2014 23:47 May 13, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S1356.IS S1356 pamtmann on DSKBFK8HB2PROD with BILLS 3 •S 1356 IS purchased focused ‘‘on amplifying divisive social and 1 political messages . . .’’. 2 (3) In 2002, the Bipartisan Campaign Reform 3 Act became law, establishing disclosure requirements 4 for political advertisements distributed from a tele- 5 vision or radio broadcast station or provider of cable 6 or satellite television. In 2003, the Supreme Court 7 upheld regulations on electioneering communications 8 established under the Act, noting that such require- 9 ments ‘‘provide the electorate with information and 10 insure that the voters are fully informed about the 11 person or group who is speaking.’’. 12 (4) According to a study from Borrell Associ- 13 ates, in 2016, $1,415,000,000 was spent on online 14 advertising, more than quadruple the amount in 15 2012. 16 (5) The reach of a few large internet plat- 17 forms—larger than any broadcast, satellite, or cable 18 provider—has greatly facilitated the scope and effec- 19 tiveness of disinformation campaigns. For instance, 20 the largest platform has over 210,000,000 American 21 users—over 160,000,000 of them on a daily basis. 22 By contrast, the largest cable television provider has 23 22,430,000 subscribers, while the largest satellite 24 television provider has 21,000,000 subscribers. And 25 VerDate Sep 11 2014 23:47 May 13, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1356.IS S1356 pamtmann on DSKBFK8HB2PROD with BILLS 4 •S 1356 IS the most-watched television broadcast in U.S. his- 1 tory had 118,000,000 viewers. 2 (6) The public nature of broadcast television, 3 radio, and satellite ensures a level of publicity for 4 any political advertisement. These communications 5 are accessible to the press, fact-checkers, and polit- 6 ical opponents; this creates strong disincentives for 7 a candidate to disseminate materially false, inflam- 8 matory, or contradictory messages to the public. So- 9 cial media platforms, in contrast, can target portions 10 of the electorate with direct, ephemeral advertise- 11 ments often on the basis of private information the 12 platform has on individuals, enabling political adver- 13 tisements that are contradictory, racially or socially 14 inflammatory, or materially false. 15 (7) According to comScore, 2 companies own 8 16 of the 10 most popular smartphone applications as 17 of June 2017, including the most popular social 18 media and email services—which deliver information 19 and news to users without requiring proactivity by 20 the user. Those same 2 companies accounted for 99 21 percent of revenue growth from digital advertising in 22 2016, including 77 percent of gross spending. 79 23 percent of online Americans—representing 68 per- 24 cent of all Americans—use the single largest social 25 VerDate Sep 11 2014 23:47 May 13, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1356.IS S1356 pamtmann on DSKBFK8HB2PROD with BILLS 5 •S 1356 IS network, while 66 percent of these users are most 1 likely to get their news from that site. 2 (8) In its 2006 rulemaking, the Federal Elec- 3 tion Commission noted that only 18 percent of all 4 Americans cited the internet as their leading source 5 of news about the 2004 Presidential election; by con- 6 trast, the Pew Research Center found that 65 per- 7 cent of Americans identified an internet-based 8 source as their leading source of information for the 9 2016 election. 10 (9) The Federal Election Commission, the inde- 11 pendent Federal agency charged with protecting the 12 integrity of the Federal campaign finance process by 13 providing transparency and administering campaign 14 finance laws, has failed to take action to address on- 15 line political advertisements. 16 (10) In testimony before the Senate Select 17 Committee on Intelligence titled, ‘‘Disinformation: A 18 Primer in Russian Active Measures and Influence 19 Campaigns,’’ multiple expert witnesses testified that 20 while the disinformation tactics of foreign adver- 21 saries have not necessarily changed, social media 22 services now provide ‘‘platform[s] practically pur- 23 pose-built for active measures[.]’’ Similarly, as Gen. 24 (RET) Keith B. Alexander, the former Director of 25 VerDate Sep 11 2014 23:47 May 13, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S1356.IS S1356 pamtmann on DSKBFK8HB2PROD with BILLS 6 •S 1356 IS the National Security Agency, testified, during the 1 Cold War ‘‘if the Soviet Union sought to manipulate 2 information flow, it would have to do so principally 3 through its own propaganda outlets or through ac- 4 tive measures that would generate specific news: 5 planting of leaflets, inciting of violence, creation of 6 other false materials and narratives. But the news 7 itself was hard to manipulate because it would have 8 required actual control of the organs of media, which 9 took long-term efforts to penetrate. Today, however, 10 because the clear majority of the information on so- 11 cial media sites is uncurated and there is a rapid 12 proliferation of information sources and other sites 13 that can reinforce information, there is an increasing 14 likelihood that the information available to average 15 consumers may be inaccurate (whether intentionally 16 or otherwise) and may be more easily manipulable 17 than in prior eras.’’. 18 (11) Current regulations on political advertise- 19 ments do not provide sufficient transparency to up- 20 hold the public’s right to be fully informed about po- 21 litical advertisements made online. 22 SEC. 4. SENSE OF CONGRESS. 23 It is the sense of Congress that— 24 VerDate Sep 11 2014 23:47 May 13, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1356.IS S1356 pamtmann on DSKBFK8HB2PROD with BILLS 7 •S 1356 IS (1) the dramatic increase in digital political ad- 1 vertisements, and the growing centrality of online 2 platforms in the lives of Americans, requires the 3 Congress and the Federal Election Commission to 4 take meaningful action to ensure that laws and reg- 5 ulations provide the accountability and transparency 6 that is fundamental to our democracy; 7 (2) free and fair elections require both trans- 8 parency and accountability which give the public a 9 right to know the true sources of funding for polit- 10 ical advertisements in order to make informed polit- 11 ical choices and hold elected officials accountable; 12 and 13 (3) transparency of funding for political adver- 14 tisements is essential to enforce other campaign fi- 15 nance laws, including the prohibition on campaign 16 spending by foreign nationals. 17 SEC. 5. EXPANSION OF DEFINITION OF PUBLIC COMMU- 18 NICATION. 19 (a) IN GENERAL.—Paragraph (22) of section 301 of 20 the Federal Election Campaign Act of 1971 (52 U.S.C. 21 30101(22)) is amended by striking ‘‘or satellite commu- 22 nication’’ and inserting ‘‘satellite, paid internet, or paid 23 digital communication’’. 24 VerDate Sep 11 2014 23:47 May 13, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S1356.IS S1356 pamtmann on DSKBFK8HB2PROD with BILLS 8 •S 1356 IS (b) TREATMENT OF CONTRIBUTIONS AND EXPENDI- 1 TURES.—Section 301 of such Act (52 U.S.C. 30101) is 2 amended— 3 (1) in paragraph (8)(B)— 4 (A) by striking ‘‘on broadcasting stations, 5 or in newspapers, magazines, or similar types of 6 general public political advertising’’ in clause 7 (v) and inserting ‘‘in any public communica- 8 tion’’; 9 (B) by striking ‘‘broadcasting, newspaper, 10 magazine, billboard, direct mail, or similar type 11 of general public communication or political ad- 12 vertising’’ in clause (ix)(1) and inserting ‘‘pub- 13 lic communication’’; and 14 (C) by striking ‘‘but not including the use 15 of broadcasting, newspapers, magazines, bill- 16 boards, direct mail, or similar types of general 17 public communication or political advertising’’ 18 in clause (x) and inserting ‘‘but not including 19 use in any public communication’’; and 20 (2) in paragraph (9)(B)— 21 (A) by striking clause (i) and inserting the 22 following: 23 ‘‘(i) any news story, commentary, or 24 editorial distributed through the facilities 25 VerDate Sep 11 2014 23:47 May 13, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S1356.IS S1356 pamtmann on DSKBFK8HB2PROD with BILLS 9 •S 1356 IS of any broadcasting station or any print, 1 online, or digital newspaper, magazine, 2 blog, publication, or periodical, unless such 3 broadcasting, print, online, or digital facili- 4 ties are owned or controlled by any polit- 5 ical party, political committee, or can- 6 didate;’’; and 7 (B) by striking ‘‘on broadcasting stations, 8 or in newspapers, magazines, or similar types of 9 general public political advertising’’ in clause 10 (iv) and inserting ‘‘in any public communica- 11 tion’’. 12 (c) DISCLOSURE AND DISCLAIMER STATEMENTS.— 13 Subsection (a) of section 318 of such Act (52 U.S.C. 14 30120) is amended— 15 (1) by striking ‘‘financing any communication 16 through any broadcasting station, newspaper, maga- 17 zine, outdoor advertising facility, mailing, or any 18 other type of general public political advertising’’ 19 and inserting ‘‘financing any public communication’’; 20 and 21 (2) by striking ‘‘solicits any contribution 22 through any broadcasting station, newspaper, maga- 23 zine, outdoor advertising facility, mailing, or any 24 other type of general public political advertising’’ 25 VerDate Sep 11 2014 23:47 May 13, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S1356.IS S1356 pamtmann on DSKBFK8HB2PROD with BILLS 10 •S 1356 IS and inserting ‘‘solicits any contribution through any 1 public communication’’. 2 SEC. 6. EXPANSION OF DEFINITION OF ELECTIONEERING 3 COMMUNICATION. 4 (a) EXPANSION TO ONLINE COMMUNICATIONS.— 5 (1) APPLICATION TO QUALIFIED INTERNET AND 6 DIGITAL COMMUNICATIONS.— 7 (A) IN GENERAL.—Subparagraph (A) of 8 section 304(f)(3) of the Federal Election Cam- 9 paign Act of 1971 (52 U.S.C. 30104(f)(3)(A)) 10 is amended by striking ‘‘or satellite communica- 11 tion’’ each place it appears in clauses (i) and 12 (ii) and inserting ‘‘satellite, or qualified internet 13 or digital communication’’. 14 (B) QUALIFIED INTERNET OR DIGITAL 15 COMMUNICATION.—Paragraph (3) of section 16 304(f) of such Act (52 U.S.C. 30104(f)) is 17 amended by adding at the end the following 18 new subparagraph: 19 ‘‘(D) QUALIFIED INTERNET OR DIGITAL 20 COMMUNICATION.—The term ‘qualified internet 21 or digital communication’ means any commu- 22 nication which is placed or promoted for a fee 23 on an online platform (as defined in subsection 24 (j)(3)).’’. 25 VerDate Sep 11 2014 23:47 May 13, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S1356.IS S1356 pamtmann on DSKBFK8HB2PROD with BILLS 11 •S 1356 IS (2) NONAPPLICATION OF RELEVANT ELEC- 1 TORATE TO ONLINE COMMUNICATIONS.—Section 2 304(f)(3)(A)(i)(III) of such Act (52 U.S.C. 3 30104(f)(3)(A)(i)(III)) is amended by inserting ‘‘any 4 broadcast, cable, or satellite’’ before ‘‘communica- 5 tion’’. 6 (3) NEWS EXEMPTION.—Section 7 304(f)(3)(B)(i) of such Act (52 U.S.C. 8 30104(f)(3)(B)(i)) is amended to read as follows: 9 ‘‘(i) a communication appearing in a 10 news story, commentary, or editorial dis- 11 tributed through the facilities of any 12 broadcasting station or any online or dig- 13 ital newspaper, magazine, blog, publica- 14 tion, or periodical, unless such broad- 15 casting, online, or digital facilities are 16 owned or controlled by any political party, 17 political committee, or candidate;’’. 18 (b) EFFECTIVE DATE.—The amendments made by 19 this section shall apply with respect to communications 20 made on or after January 1, 2020. 21 SEC. 7. APPLICATION OF DISCLAIMER STATEMENTS TO ON- 22 LINE COMMUNICATIONS. 23 (a) CLEAR AND CONSPICUOUS MANNER REQUIRE- 24 MENT.—Subsection (a) of section 318 of the Federal Elec- 25 VerDate Sep 11 2014 23:47 May 13, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S1356.IS S1356 pamtmann on DSKBFK8HB2PROD with BILLS 12 •S 1356 IS tion Campaign Act of 1971 (52 U.S.C. 30120(a)) is 1 amended— 2 (1) by striking ‘‘shall clearly state’’ each place 3 it appear [Text truncated for display. Full text available on Congress.gov.]