KIDS Act

I 116TH CONGRESS 2D SESSION H. R. 8372 To keep children safe and protect their interests on the internet, and for other purposes. IN THE HOUSE OF REPRESENTATIVES SEPTEMBER 24, 2020 Ms. CASTOR of Florida (for herself, Ms. CLARKE of New York, and Ms. WEXTON) introduced the following bill; which was referred to the Com- mittee on Energy and Commerce A BILL To keep children safe and protect their interests on the internet, 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 ‘‘Kids Internet Design 4 and Safety Act’’ or the ‘‘KIDS Act’’. 5 SEC. 2. FINDINGS. 6 Congress finds the following: 7 (1) Children increasingly consume digital enter- 8 tainment on the internet and are uniquely suscep- 9 tible to manipulation online, given their lack of im- 10 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H8372.IH H8372 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 8372 IH portant neurological and psychological mechanisms 1 which are developed later in adulthood. 2 (2) Today’s digital media environment, which is 3 constantly evolving and now includes high-tech expe- 4 riences, such as augmented reality and virtual re- 5 ality, is largely designed in non-transparent ways to 6 ensure children interact with content that reflect the 7 interests and goals of content creators, platforms, 8 and marketers. 9 (3) Artificial intelligence, machine learning, and 10 other complex systems are used to make continuous 11 decisions about how online content for children can 12 be personalized to increase engagement. 13 (4) Online companies gather, analyze, and use 14 data for behavioral marketing directed at children. 15 (5) Companies employ sophisticated strategies, 16 including neuromarketing, to affect consumer behav- 17 ior and manipulate decision making. 18 (6) Branded content in various forms of multi- 19 media, including native advertising and influencer 20 marketing, exposes children to marketing that is in- 21 herently manipulative or purposely disguised as en- 22 tertainment or other information. 23 SEC. 3. DEFINITIONS. 24 (a) IN GENERAL.—In this Act: 25 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H8372.IH H8372 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 8372 IH (1) AUGMENTED REALITY.—The term ‘‘aug- 1 mented reality’’ means an application or web-based 2 experience utilizing a camera to change or enhance 3 the user’s view of the real world. 4 (2) BRANDED CONTENT.—The term ‘‘branded 5 content’’ means commercial content created for, and 6 distributed on, a platform in such a way that the 7 line between entertainment and advertising becomes 8 unclear in order to generate a positive view of the 9 brand. 10 (3) COMMISSION.—The term ‘‘Commission’’ 11 means the Federal Trade Commission. 12 (4) COVERED USER.—The term ‘‘covered user’’ 13 means an individual under the age of 16. 14 (5) DIRECTED TO CHILDREN.—The term ‘‘di- 15 rected to children’’ means the targeting of covered 16 users by a platform, as demonstrated by, with re- 17 spect to such platform— 18 (A) its subject matter; 19 (B) its visual content; 20 (C) the use of animated characters or 21 child-oriented activities for children and related 22 incentives; 23 (D) music or other audio content; 24 (E) the age of models used; 25 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H8372.IH H8372 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 8372 IH (F) the presence of— 1 (i) child celebrities; or 2 (ii) celebrities who appeal to covered 3 users; 4 (G) the language used; 5 (H) advertising content used on, or used to 6 advertise, such platform; or 7 (I) reliable empirical evidence relating to— 8 (i) the composition of the audience of 9 such platform; and 10 (ii) the intended audience of such 11 platform. 12 (6) HOST-SELLING.—The term ‘‘host-selling’’ 13 refers to commercial video content that features the 14 same characters or individuals as in the adjacent 15 noncommercial content. 16 (7) INFLUENCER MARKETING.—The term 17 ‘‘influencer marketing’’ means a tactic by which a 18 brand or agency or publisher works with individuals 19 who are deemed to have the potential to create en- 20 gagement, drive conversation, or sell products or 21 services with the intended target audience, in order 22 to drive brand messages. 23 (8) MANIPULATION.—The term ‘‘manipulation’’ 24 means design strategies, product settings, and prod- 25 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H8372.IH H8372 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 8372 IH uct architecture targeted to cognitive vulnerabilities 1 with the intention or effect of pushing the user to 2 make choices to their detriment and the operator’s 3 benefit. 4 (9) NATIVE ADVERTISING.—The term ‘‘native 5 advertising’’ means a form of paid media where the 6 advertising experience follows the natural form and 7 function of the user experience in which it is placed. 8 (10) NEUROMARKETING.—The term ‘‘neuro- 9 marketing’’ means a subfield of marketing that at- 10 tempts to predict and potentially manipulate con- 11 sumer behavior and decision making based on anal- 12 ysis of brain patterns. 13 (11) OPERATOR.— 14 (A) IN GENERAL.—The term ‘‘operator’’ 15 means any person who operates a platform, in- 16 cluding any person offering products or services 17 for sale through that platform, involving com- 18 merce— 19 (i) among the several States or with 20 one or more foreign nations; 21 (ii) in any territory of the United 22 States or in the District of Columbia, or 23 between any such territory and— 24 (I) another such territory; or 25 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H8372.IH H8372 kjohnson on DSK79L0C42PROD with BILLS 6 •HR 8372 IH (II) any State or foreign nation; 1 or 2 (iii) between the District of Columbia 3 and any State, territory, or foreign nation. 4 (B) EXCEPTION.—The term ‘‘operator’’ 5 does not include any nonprofit entity that would 6 otherwise be exempt from coverage under sec- 7 tion 5 of the Federal Trade Commission Act 8 (15 U.S.C. 45). 9 (12) PERSON.—The term ‘‘person’’ means any 10 individual, partnership, corporation, trust, estate, co- 11 operative, association, or other entity. 12 (13) PLATFORM.—The term ‘‘platform’’ means 13 a website, online service, online application, or mo- 14 bile application which is operated for commercial 15 purposes. 16 (14) VIRTUAL REALITY.—The term ‘‘virtual re- 17 ality’’ means an application or web-based experience 18 utilizing a camera to create an immersive environ- 19 ment that mimics the real world, usually via a head- 20 set. 21 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H8372.IH H8372 kjohnson on DSK79L0C42PROD with BILLS 7 •HR 8372 IH SEC. 4. REGULATION OF ACTS AND PRACTICES ON CHILD- 1 DIRECTED PLATFORMS. 2 (a) PROHIBITION ON CERTAIN FEATURES.—It is un- 3 lawful for an operator of a platform directed to children 4 to incorporate any of the following features: 5 (1) Any auto-play setting that, without input 6 from the covered user, commences additional video 7 content directly following the video content initially 8 selected by the user. 9 (2) Push alerts that urge a covered user to 10 spend more time engaged with the platform when 11 they are not actively using it. 12 (3) Displaying the quantity of positive engage- 13 ment or feedback that a covered user has received 14 from other users. 15 (4) Any design feature or setting that unfairly 16 encourages a covered user, due to their age or inex- 17 perience, to make purchases, submit content, or 18 spend more time engaging with the platform. 19 (5) Any feature that provides a covered user 20 with badges or other visual award symbols based on 21 elevated levels of engagement with the platform. 22 (b) PROHIBITION ON AMPLIFICATION OF CERTAIN 23 CONTENT; USER REPORTING MECHANISM.—It shall be 24 unlawful for an operator of a platform directed to children, 25 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H8372.IH H8372 kjohnson on DSK79L0C42PROD with BILLS 8 •HR 8372 IH or a platform for which the operator has constructive 1 knowledge that covered users use its platform, to— 2 (1) amplify, promote, or encourage covered 3 users’ consumption of videos and other forms of con- 4 tent that involve— 5 (A) sexual material; 6 (B) physical or emotional violence, includ- 7 ing bullying; 8 (C) adult activities, including gambling; or 9 (D) other dangerous, abusive, exploitative, 10 or wholly commercial content; or 11 (2) fail to implement a mechanism for users to 12 report suspected violations of any requirement under 13 paragraph (1). 14 (c) PROHIBITION ON CERTAIN ADVERTISING METH- 15 ODS.— 16 (1) IN GENERAL.—It shall be unlawful for an 17 operator of a platform directed to children to— 18 (A) direct content that includes host-selling 19 to covered users; 20 (B) expose covered users to program- 21 length advertisements; 22 (C) direct branded content or native adver- 23 tising to covered users; 24 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H8372.IH H8372 kjohnson on DSK79L0C42PROD with BILLS 9 •HR 8372 IH (D) direct online advertising or material 1 with considerable commercial content involving 2 alcohol, nicotine, or tobacco to covered users; 3 (E) expose covered users to online adver- 4 tising or material with considerable commercial 5 content with any imbedded interactive elements 6 that take advantage of covered users’ inexperi- 7 ence or credulity in noncommercial child-di- 8 rected content; or 9 (F) direct content that includes product 10 placement to covered users. 11 (2) PROGRAM-LENGTH ADVERTISEMENT.—The 12 term ‘‘program-length advertisement’’ shall be de- 13 fined by the Commission through regulation or other 14 public guidance. 15 (d) PROHIBITION ON USE OF PERSONAL INFORMA- 16 TION.—It shall be unlawful for an operator of a platform 17 directed to children to use age verification information col- 18 lected from covered users for any commercial purpose. 19 (e) REGULATIONS.—The Commission shall promul- 20 gate regulations in accordance with section 553 of title 21 5, United States Code, to require any operator of a plat- 22 form directed to children to incorporate online visual ele- 23 ments or other indicators that distinguish commercial con- 24 tent from noncommercial content. 25 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H8372.IH H8372 kjohnson on DSK79L0C42PROD with BILLS 10 •HR 8372 IH SEC. 5. MARKETING AND COMMERCIALIZATION. 1 (a) CONTENT LABELING SYSTEM REPORT.—Not 2 later than the date that is 1 year after the date of enact- 3 ment of this Act, the Commission shall submit to Congress 4 a report— 5 (1) containing recommendations for a labeling 6 system to allow parents to identify noncommercial, 7 educational, and enriching content for covered users 8 online; and 9 (2) address considerations regarding how such 10 labeling system should— 11 (A) analyze content based on evidence- 12 based criteria; 13 (B) employ an easy-to-understand visual 14 cue for parents to identify content described in 15 paragraph (1); 16 (C) receive regular review to determine its 17 effectiveness; and 18 (D) develop a mechanism for users to re- 19 port to the Commission complaints of mis- 20 labeled content and for the Commission to rem- 21 edy such instances of mislabeled content. 22 (b) CONSULTATION.—The report described in sub- 23 section (a) shall be developed by the Commission in con- 24 sultation with an advisory board, to be created and con- 25 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H8372.IH H8372 kjohnson on DSK79L0C42PROD with BILLS 11 •HR 8372 IH vened by the Commission, which is comprised of experts 1 in child development, child health, education, and media. 2 SEC. 6. TRANSPARENCY AND AUDITING. 3 (a) TRANSPARENCY.—The Commission shall promul- 4 gate regulations in accordance with section 553 of title 5 5, United States Code, requiring an operator of a platform 6 which is directed to children to publish and maintain a 7 publicly accessible digital record of the viewable or play- 8 able content of each such platform. 9 (b) ANNUAL PLATFORM AUDITS.—The regulations 10 promulgated pursuant to subsection (a) shall include the 11 establishment of an annual audit process, to be conducted 12 during the 5-year period subsequent to the date of enact- 13 ment of this Act, for each of the 25 platforms directed 14 to children with the highest total number of child users, 15 to evaluate the level of compliance by each such platform 16 with respect to the requirements under this Act. 17 (c) REPORT.—The Commission shall issue annual re- 18 ports to Congress based on the audits described in sub- 19 section (b) that— 20 (1) describe the level of compliance by the plat- 21 forms described in such subsection with respect to 22 the requirements under this Act; and 23 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H8372.IH H8372 kjohnson on DSK79L0C42PROD with BILLS 12 •HR 8372 IH (2) provide recommendations for such legisla- 1 tion and administrative actions as the Commission 2 determines appropriate based on the audit findings. 3 SEC. 7. GRANT PROGRAM. 4 (a) ESTABLISHMENT.— 5 (1) IN GENERAL.—The Secretary of Commerce 6 shall provide grants to eligible persons to foster the 7 creation and promotion of advertisement-free and 8 educational online content for covered users, such as 9 videos and applications. 10 (2) ELIGIBLE PERSON.—For purposes of this 11 section, the term ‘‘eligible person’’ means a person 12 that has submitted an application, as approved by 13 the Secretary of Commerce pursuant to the eligi- 14 bility requirements developed under subsection (b), 15 for the creation and promotion of advertisement-free 16 and educational online content for covered users. 17 (b) ADVISORY COUNCIL.—The Secretary shall estab- 18 lish and convene an Advisory Council on Children’s Online 19 Content, which shall be— 20 (1) comprised of experts in education, child de- 21 velopment, psychology, online media, and other re- 22 lated disciplines; and 23 (2) tasked with developing evidence-based cri- 24 teria for grant eligibility and grant distribution. 25 VerDate Sep 11 2014 04:31 Oct 16, 2020 Jkt 019200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILL [Text truncated for display. 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