To authorize the Federal Trade Commission, in consultation with the Federal Communications Commission, to review volume usage service plans of major broadband Internet service providers to ensure that such plans are fairly based on cost.

Summary: Broadband Internet Fairness Act - Makes it unlawful for major broadband Internet service providers to offer volume usage service plans imposing rates, terms, and conditions that are unjust, unreasonable, or unreasonably discriminatory. Treats a violation as an unfair or deceptive act or practice under the Federal Trade Commission Act.

Requires major broadband Internet service providers offering or proposing to offer volume usage plans to file a service plan analysis with the Federal Trade Commission (FTC).

Requires the FTC to enforce this Act.

Defines "major broadband Internet service provider" as a broadband Internet service provider that, directly or through an affiliate, provides broadband Internet service to 2 million or more subscribers.

Defines "volume usage service plan" as any choice of service offerings to a residential consumer that includes two or more different sets of rates, terms, or conditions directly or indirectly based on the amount of data transmitted to or from the consumer within a fixed period of time.

Includes nonprofit organizations or higher education institutions in the term "residential consumer."

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Broadband Internet Fairness Act''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) Increased deployment and adoption of broadband, 
        including high-bandwidth uses of broadband, is key to allow 
        broadband stimulus funds to produce maximal economic recovery 
        and growth, and is key to the network effects of economic 
        benefit associated with the Internet.
            (2) No volume usage service plan for broadband Internet 
        access can be just and reasonable unless charges are fairly 
        based on the cost of the usage.
            (3) Volume usage charges for broadband Internet access that 
        are substantially above cost in a market without sufficient 
        competition constitute an unfair and unconscionable practice, 
        as substantially above-cost pricing has anti-competitive and 
        anti-consumer effects on Internet use, including in particular 
        Internet use for online video delivery.
            (4) The market for video delivery is effectively controlled 
        by companies operating both traditional cable delivery and 
        broadband Internet access services, increasing incentives to 
        raise prices for Internet use in high volumes, to discourage 
        consumers who may wish no longer to subscribe to traditional 
        cable services.
            (5) The Federal Trade Commission Act authorizes the Federal 
        Trade Commission to investigate and remedy consumer pricing 
        practices that it determines to be unfair or anti-competitive, 
        including pricing practices by Internet service providers, as 
        Internet services are not provided on a common carrier basis 
        and therefore are not subject to the common carrier limitation 
        on Federal Trade Commission jurisdiction.

SEC. 3. UNJUST, UNREASONABLE, OR UNREASONABLY DISCRIMINATORY VOLUME 
              USAGE SERVICE PLANS.

    (a) Prohibition.--It shall be unlawful for major broadband Internet 
service providers to offer volume usage service plans imposing rates, 
terms, and conditions that are unjust, unreasonable, or unreasonably 
discriminatory.
    (b) Service Plan Analysis Filing Required.--Major broadband 
Internet service providers offering, or proposing to offer, volume 
usage service plans to any portion of their service territory are 
required to file with the Federal Trade Commission a service plan 
analysis that--
            (1) identifies the different service tiers of broadband 
        Internet service to be offered on the basis of different data 
        transmission volumes;
            (2) specifies the different rates, terms, and conditions to 
        be imposed for such tiers;
            (3) provides an analysis of the economic reasonableness and 
        necessity for imposing such tiers--
                    (A) based on assigning the capital costs of 
                deploying the facilities needed to provide such 
                different service tiers;
                    (B) based on assigning different operating costs, 
                if any, that are attributable to the provision of 
                different service tiers; or
                    (C) based on other factors and costs specified by 
                the provider as a justification for the proposed volume 
                usage service plan;
            (4) assess the impact of such service tiers on the ability 
        of residential consumers to access widely used Internet 
        services, including uses for agricultural, medical, 
        educational, environmental, library, and nonprofit purposes; 
        and
            (5) specifies the basis upon which the different rates of 
        charges under the service plan will be revised over the 
        following 3 years, and inflation factors or other variables 
        that will be used to calculate or limit such revisions.

SEC. 4. ENFORCEMENT BY THE FEDERAL TRADE COMMISSION.

    (a) Enforcement by FTC.--The Commission shall, in consultation with 
the Federal Communications Commission, review each service plan 
analysis submitted under section 3(b) in order to determine whether the 
volume usage service plan is in violation of section 3(a). A violation 
of section 3(a) shall be treated as a violation of a rule defining an 
unfair or deceptive act or practice prescribed under section 
18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C. 
57(a)(1)(B)). The Federal Trade Commission shall enforce this Act in 
the same manner, by the same means, and with the same jurisdiction as 
though all applicable terms and provision of the Federal Trade 
Commission Act were incorporated into and made a part of this Act.
    (b) Review and Remediation.--After an initial review of any service 
plan analysis submitted under section 3(b), if the Commission 
identifies any elements of such plan that appear to constitute a 
violation of section 3(a), the Commission shall notify the provider 
submitting such plan of such elements and of the steps the provider may 
take to correct such violations. The Commission shall, prior to 
initiating any action under subsection (e), review the steps taken by 
the provider to correct such violations.
    (c) Factors Considered.--In determining whether a major broadband 
Internet service provider has violated section 3(a), the Commission, in 
consultation with the Federal Communications Commission, shall take 
into account, among other factors--
            (1) whether the service plan analysis filed with the 
        Commission does not properly assign operating costs to each of 
        the service tiers within the volume usage service plan;
            (2) whether the rates, terms, and conditions are not 
        justified by the costs of deploying or operating the facilities 
        required to provide and maintain the service tiers within the 
        volume usage service plan;
            (3) whether the volume usage service plan imposes unjust, 
        unreasonable, or unreasonably discriminatory charges on 
        residential consumers;
            (4) whether the volume usage service plan deters or 
        impedes--
                    (A) the deployment of and access to widely used 
                Internet applications and services; or
                    (B) the participation of residential consumers in 
                the growth and development of regional, national, and 
                international economies;
            (5) whether the volume usage service plan unfairly 
        penalizes consumers choosing to use high bandwidth Internet 
        applications and services, including those used for one-way or 
        two-way video;
            (6) whether the volume usage service plan has anti-
        competitive effects on the market for video delivery or the 
        markets for Internet applications or services;
            (7) whether the volume usage service plan imposes anti-
        consumer rates, terms, or conditions that reflect insufficient 
        competition in the local market for broadband Internet 
        services; or
            (8) whether the volume usage service plan fails to comply 
        with such other factors as the Commission, in consultation with 
        the Federal Communications Commission, determines to be 
        appropriate as set forth in the rules prescribed under section 
        5.
    (d) Hearings.--As a component of its review of each plan submitted 
under subsection (a), the Commission shall, after the provider 
submitting such plan has had an opportunity to take steps under 
subsection (b) to correct any violations identified by the Commission 
in its notice to the provider under such subsection, provide for the 
conduct of a public hearing by a Commissioner or other designated 
employee of the Commission, and for the collection of public comment 
and testimony with respect to such plan. Such hearing shall be 
conducted in a such a community or communities in such State or States 
as the Commission determines are most directly affected by the volume 
usage service plan.
    (e) Civil Penalties.--
            (1) Notwithstanding the penalties set forth under the 
        Federal Trade Commission Act, any major broadband Internet 
        service provider who violates section 3(a) shall be subject to 
        injunctive relief requiring the broadband Internet service 
        provider proposing or offering such plan to suspend, terminate, 
        or revise such plan.
            (2) In addition to injunctive relief, any major broadband 
        Internet service provider who violates section 3(a) may be 
        subject to a fine of not more than $1,000,000, as the 
        Commission determines is required to ensure ongoing compliance 
        with this Act.

SEC. 5. COMMISSION RULEMAKING REQUIRED.

    Within 180 days after the date of enactment of this Act, the 
Commission shall, by rule prescribed in accordance with section 553 of 
title 5, United States Code, establish procedures for the review of 
volume usage service plans and for the conduct of public hearings 
pursuant to the requirements of this Act.

SEC. 6. EFFECT ON OTHER LAWS.

    Nothing in this Act shall be construed to limit the authority of 
the Commission to bring enforcement actions or take other measures 
under the Federal Trade Commission Act or any other provision of law.

SEC. 7. DEFINITIONS.

    (a) In General.--For purposes of this Act:
            (1) Commission.--The term ``Commission'' means the Federal 
        Trade Commission.
            (2) Broadband internet service.--The term ``broadband 
        Internet service'' means an Internet protocol-based 
        transmission service that enables users to send and receive 
        voice, video, data, graphics, or a combination thereof.
            (3) Broadband internet service provider.--The term 
        ``broadband Internet service provider'' means any person who 
        provides or offers to provide broadband Internet service, 
        either directly or through an affiliate.
            (4) Major broadband internet service provider.--The term 
        ``major broadband Internet service provider'' means a broadband 
        Internet service provider that, either directly or through an 
        affiliate, provides broadband Internet service to 2,000,000 or 
        more subscribers, as further defined by the rules prescribed by 
        the Commission pursuant to section 5.
            (5) Volume usage service plan.--The term ``volume usage 
        service plan'' means any choice of broadband Internet service 
        offerings to a residential consumer that includes two or more 
        different sets of rates, terms, or conditions that are directly 
        or indirectly based upon the amount of data actually 
        transmitted to or from the consumer within a fixed period of 
        time.
            (6) Residential consumer.--The term ``residential 
        consumer'' includes any individual consumer who subscribes to 
        broadband Internet services primarily for purposes other than a 
        for-profit business purpose, and includes subscribers that are 
        nonprofit organizations or institutions of higher education.
    (b) Common Terminology.--Except as otherwise provided in subsection 
(a), terms used in this Act have the meanings provided under section 3 
of the Communications Act of 1934 (47 U.S.C. 153) and section 602 of 
such Act (47 U.S.C. 522).