Title: National Security and Personal Data Protection Act of 2019
Policy area: Science, Technology, Communications

Summary:
National Security and Personal Data Protection Act of 2019
This bill prohibits the transfer of data to, and storage of data within, foreign countries that threaten U.S. national security.
Specifically, the bill requires the Department of State to designate as a country of concern any country, including the People's Republic of China and the Russian Federation, whose data privacy and security requirements pose a substantial risk to U.S. national security.
A technology company that is subject to the jurisdiction of a country of concern and that provides a website or internet application operating in interstate or foreign commerce shall
Additionally, any company that provides a website or internet application operating in interstate or foreign commerce but which is not subject to the jurisdiction of a country of concern is prohibited from transferring data to a country of concern or storing user data on a server located in a country of concern.
The Federal Trade Commission shall enforce these requirements; however, the bill also provides for civil actions brought by either an individual or the attorney general of a state to enjoin the engagement of any person in a practice that violates the prohibitions in this bill.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 2889 Introduced in Senate (IS)]

<DOC>






116th CONGRESS
  1st Session
                                S. 2889

To safeguard data of Americans from foreign governments that pose risks 
    to national security by imposing data security requirements and 
  strengthening review of foreign investments, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           November 18, 2019

  Mr. Hawley (for himself, Mr. Cotton, and Mr. Rubio) introduced the 
 following bill; which was read twice and referred to the Committee on 
                 Commerce, Science, and Transportation

_______________________________________________________________________

                                 A BILL


 
To safeguard data of Americans from foreign governments that pose risks 
    to national security by imposing data security requirements and 
  strengthening review of foreign investments, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National Security and Personal Data 
Protection Act of 2019''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Commission.--The term ``Commission'' means the Federal 
        Trade Commission.
            (2) Country of concern.--
                    (A) In general.--Subject to subparagraph (B)(iii), 
                the term ``country of concern'' means--
                            (i) the People's Republic of China;
                            (ii) the Russian Federation; and
                            (iii) any other country designated by the 
                        Secretary of State as being of concern with 
                        respect to the protection of data privacy and 
                        security.
                    (B) Designation of countries of concern.--Not later 
                than 1 year after the date of enactment of this Act, 
                and annually thereafter, the Secretary of State shall--
                            (i) review the status of data privacy and 
                        security requirements (including by reviewing 
                        laws, policies, practices, and regulations 
                        related to data privacy and security) in each 
                        foreign country to determine--
                                    (I) whether it would pose a 
                                substantial risk to the national 
                                security of the United States if the 
                                government of such country gained 
                                access to the user data of citizens and 
                                residents of the United States; and
                                    (II) whether there is a substantial 
                                risk that the government of such 
                                country will, in a manner that fails to 
                                afford similar respect for civil 
                                liberties and privacy as the 
                                Constitution and laws of the United 
                                States, obtain user data from companies 
                                that collect user data;
                            (ii) designate each country that meets the 
                        criteria of clause (i) as a country of concern; 
                        and
                            (iii) remove the designation from any 
                        country that was previously designated a 
                        country of concern (regardless of whether such 
                        designation was pursuant to clause (i) or (ii) 
                        of subparagraph (A) or was made by the 
                        Secretary of State pursuant to clause (iii) of 
                        such subparagraph) if the country--
                                    (I) no longer meets the criteria of 
                                clause (i); and
                                    (II) is not at substantial risk of 
                                meeting such criteria.
                    (C) Regulations.--Not later than 90 days after the 
                date of the enactment of this Act, the Secretary of 
                State shall prescribe regulations--
                            (i) establishing a process for a covered 
                        technology company or country of concern to 
                        petition the Secretary to remove the country of 
                        concern designation from a country that was 
                        designated as such pursuant to subparagraph 
                        (B)(ii); and
                            (ii) setting forth the procedures and 
                        criteria the Secretary will use in identifying 
                        or removing countries under subparagraphs 
                        (A)(iii) or (B)(iii).
            (3) Covered technology company.--The term ``covered 
        technology company'' means an entity that provides an online 
        data-based service such as a website or internet application in 
        or affecting interstate or foreign commerce and--
                    (A) is organized under the laws of a country of 
                concern;
                    (B) in which foreign persons that are nationals of, 
                or companies that are organized under the laws of, 
                countries of concern have a plurality or controlling 
                equity interest;
                    (C) is a subsidiary company of an entity described 
                in subparagraph (A) or (B); or
                    (D) is otherwise subject to the jurisdiction of a 
                country of concern in a manner that allows the country 
                of concern to obtain the user data of citizens and 
                residents of the United States without similar respect 
                for civil liberties and privacy as provided under the 
                Constitution and laws of the United States.
            (4) Facial recognition technology.--The term ``facial 
        recognition technology'' means technology that analyzes facial 
        features in still or video images and is used to identify, or 
        facilitate identification of, an individual using facial 
        physical characteristics.
            (5) Targeted advertising.--
                    (A) In general.--The term ``targeted advertising'' 
                means a form of advertising where advertisements are 
                displayed to a user based on the user's traits, 
                information from a profile about the user that is 
                created for the purpose of selling advertisements, or 
                the user's previous online or offline behavior.
                    (B) Limitation.--Such term shall not include 
                advertising chosen because of the context of the 
                internet service, such as--
                            (i) advertising that is directed to a user 
                        based on the content of the website, online 
                        service, online application, or mobile 
                        application that the user is connected to; or
                            (ii) advertising that is directed to a user 
                        by the operator of a website, online service, 
                        online application, or mobile application based 
                        on the search terms that the user used to 
                        arrive at such website, service, or 
                        application.
            (6) User data.--The term ``user data'' means any 
        information obtained by an entity that provides a data-based 
        service such as a website or internet application that 
        identifies, relates to, describes, is capable of being 
        associated with, or could reasonably be linked with an 
        individual who is a citizen or resident of the United States 
        without regard to whether such information is directly 
        submitted by the individual to the entity, is derived by the 
        entity from the observed activity of the individual, or is 
        obtained by the entity by any other means.

SEC. 3. DATA SECURITY REQUIREMENTS FOR COVERED TECHNOLOGY COMPANIES.

    (a) In General.--The following requirements shall apply to a 
covered technology company:
            (1) Minimal collection of data.--The company shall not 
        collect any more user data than is necessary for the operation 
        of the website, service, or application of the company.
            (2) Prohibition on secondary uses.--The company shall not 
        use any user data collected under paragraph (1) for any purpose 
        that is secondary to the operation of the website, service, or 
        application of the company, including providing targeted 
        advertising, unnecessarily sharing such data with a third 
        party, or unnecessarily facilitating facial recognition 
        technology.
            (3) Right to view and delete data.--The company shall allow 
        an individual to--
                    (A) view any user data held by the company that 
                relates to the individual; and
                    (B) permanently delete any user data held by the 
                company that has been collected, directly or 
                indirectly, from the individual.
            (4) Prohibition on transfer to countries of concern.--The 
        company shall not transfer any user data or information needed 
        to decipher that data, such as encryption keys, to any country 
        of concern (including indirectly through a third country that 
        is not a country of concern).
            (5) Data storage requirement.--The company shall not store 
        any user data collected from citizens or residents of the 
        United States or information needed to decipher that data, such 
        as encryption keys, on a server or other data storage device 
        that is located outside of the United States or a country that 
        maintains an agreement with the United States to share data 
        with law enforcement agencies through a process established by 
        law.
            (6) Reporting requirement.--Not less frequently than 
        annually, the chief executive officer or equivalent officer of 
        the company shall submit, under penalty of perjury, a report to 
        the Commission, the Attorney General of the United States, and 
        the Attorney General of each State certifying compliance with 
        the requirements of this section.
    (b) Exceptions.--
            (1) Exception for law enforcement and military.--The 
        requirements of paragraphs (1) through (4) of subsection (a) 
        shall not apply where data is collected, used, retained, 
        stored, or shared by a covered technology company solely for 
        the purpose of assisting a law enforcement or military agency 
        that is not affiliated with a country of concern.
            (2) Transfer of shared content.--The requirements of 
        paragraph (4) and (5) of subsection (a) shall not apply to user 
        data that is content produced by a user for the purpose of 
        sharing with other users (such as social media posts, emails, 
        or data related to a transaction involving the user) or 
        information needed to decipher that data provided that the 
        transfer and any storage necessary to enact the transfer is 
        conducted solely to carry out the user's intent to share such 
        data with individual users in other countries and that 
        necessary storage occurs only on the intended recipient's 
        individual device.
    (c) Effective Date.--The requirements of this section shall take 
effect 90 days after the date of enactment of this Act.

SEC. 4. DATA SECURITY REQUIREMENTS FOR OTHER TECHNOLOGY COMPANIES.

    (a) In General.--The following requirements shall apply to any 
company operating in or affecting interstate or foreign commerce that 
provides a data-based service such as a website or internet application 
but is not a covered technology company:
            (1) Prohibition on transfer to countries of concern.--The 
        company shall not transfer any user data collected from an 
        individual in the United States or information needed to 
        decipher that data, such as encryption keys, to any country of 
        concern (including indirectly through a third country that is 
        not a country of concern).
            (2) Prohibition on storing data in countries of concern.--
        The company shall not store any user data collected from an 
        individual in the United States or information needed to 
        decipher that data, such as encryption keys, on a server or 
        other data storage device that is located in any country of 
        concern.
    (b) Exceptions.--
            (1) Exception for law enforcement and military.--The 
        requirements of subsection (a) shall not apply where data is 
        collected, used, retained, stored, or shared by a covered 
        technology company solely for the purpose of assisting a law 
        enforcement or military agency that is not affiliated with a 
        country of concern.
            (2) Transfer of shared content.--The requirements of 
        subsection (a) shall not apply to user data that is content 
        produced by a user for the purpose of sharing with other users 
        (such as social media posts, emails, or data related to a 
        transaction involving the user) or information needed to 
        decipher that data provided that the transfer and any storage 
        necessary to enact the transfer is conducted solely to carry 
        out the user's intent to share such data with individual users 
        in other countries and that necessary storage occurs only on 
        the intended recipient's individual device.
    (c) Effective Date.--The requirements of this section shall take 
effect 90 days after the date of enactment of this Act.

SEC. 5. ENFORCEMENT OF DATA SECURITY REQUIREMENTS.

    (a) Enforcement by the Commission.--
            (1) In general.--Except as otherwise provided, sections 3 
        and 4 shall be enforced by the Commission under the Federal 
        Trade Commission Act (15 U.S.C. 41 et seq.).
            (2) Unfair or deceptive acts or practices.--A violation of 
        section 3 or 4 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. 57a(a)(1)(B)).
            (3) Actions by the commission.--Except as otherwise 
        provided, the Commission shall prevent any person from 
        violating section 3 or 4 in the same manner, by the same means, 
        and with the same jurisdiction, powers, and duties as though 
        all applicable terms and provisions of the Federal Trade 
        Commission Act (15 U.S.C. 41 et seq.) were incorporated into 
        and made a part of this Act, and any person who violates such 
        section shall be subject to the penalties and entitled to the 
        privileges and immunities provided in the Federal Trade 
        Commission Act.
            (4) Authority preserved.--Nothing in this Act shall be 
        construed to limit the authority of the Commission under any 
        other provision of law.
    (b) Criminal Penalty.--
            (1) Offense.--It shall be unlawful to knowingly cause a 
        technology company to violate a requirement of section 3 or 4.
            (2) Penalty.--Any person who violates paragraph (1) shall 
        be imprisoned for not more than 5 years, fined under title 18, 
        United States Code, or both.
    (c) Enforcement by State Attorneys General.--
            (1) In general.--
                    (A) Civil actions.--In any case in which the 
                attorney general of a State has reason to believe that 
                an interest of the residents of that State has been or 
                is threatened or adversely affected by the engagement 
                of any person in a practice that violates section 3 or 
                4, the State, as parens patriae, may bring a civil 
                action on behalf of the residents of the State in a 
                district court of the United States or a State court of 
                appropriate jurisdiction to--
                            (i) enjoin that practice;
                            (ii) enforce compliance with such section;
                            (iii) on behalf of residents of the State, 
                        obtain damages, statutory damages, restitution, 
                        or other compensation, each of which shall be 
                        distributed in accordance with State law; or
                            (iv) obtain such other relief as the court 
                        may consider to be appropriate.
                    (B) Notice.--
                            (i) In general.--Before filing an action 
                        under subparagraph (A), the attorney general of 
                        the State involved shall provide to the 
                        Commission--
                                    (I) written notice of that action; 
                                and
                                    (II) a copy of the complaint for 
                                that action.
                            (ii) Exemption.--
                                    (I) In general.--Clause (i) shall 
                                not apply with respect to the filing of 
                                an action by an attorney general of a 
                                State under this paragraph if the 
                                attorney general of the State 
                                determines that it is not feasible to 
                                provide the notice described in that 
                                clause before the filing of the action.
                                    (II) Notification.--In an action 
                                described in subclause (I), the 
                                attorney general of a State shall 
                                provide notice and a copy of the 
                                complaint to the Commission at the same 
                                time as the attorney general files the 
                                action.
            (2) Intervention.--
                    (A) In general.--On receiving notice under 
                paragraph (1)(B), the Commission shall have the right 
                to intervene in the action that is the subject of the 
                notice.
                    (B) Effect of intervention.--If the Commission 
                intervenes in an action under paragraph (1), it shall 
                have the right--
                            (i) to be heard with respect to any matter 
                        that arises in that action; and
                            (ii) to file a petition for appeal.
            (3) Construction.--For purposes of bringing any civil 
        action under paragraph (1), nothing in this Act shall be 
        construed to prevent an attorney general of a State from 
        exercising the powers conferred on the attorney general by the 
        laws of that State to--
                    (A) conduct investigations;
                    (B) administer oaths or affirmations; or
                    (C) compel the attendance of witnesses or the 
                production of documentary and other evidence.
            (4) Actions by the commission.--In any case in which an 
        action is instituted by or on behalf of the Commission for 
        violation of section 3 or 4, no State may, during the pendency 
        of that action, institute an action under paragraph (1) against 
        any defendant named in the complaint in the action instituted 
        by or on behalf of the Commission for that violation.
            (5) Venue; service of process.--
                    (A) Venue.--Any action brought under paragraph (1) 
                may be brought in--
                            (i) the district court of the United States 
                        that meets applicable requirements relating to 
                        venue under section 1391 of title 28, United 
                        States Code; or
                            (ii) a State court of competent 
                        jurisdiction.
                    (B) Service of process.--In an action brought under 
                paragraph (1) in a district court of the United States, 
                process may be served wherever defendant--
                            (i) is an inhabitant; or
                            (ii) may be found.
    (d) Private Right of Action.--
            (1) In general.--Any individual who suffers injury as a 
        result of an act, practice, or omission of a covered technology 
        company that violates section 3 may bring a civil action 
        against such company in any court of competent jurisdiction.
            (2) Relief.--In a civil action brought under paragraph (1) 
        in which the plaintiff prevails, the court may award such 
        plaintiff up to $1,000 for each day that such plaintiff was 
        affected by a violation of section 3 (up to a maximum of 
        $15,000 per each such violation per plaintiff).

SEC. 6. REQUIREMENT FOR APPROVAL OF COMMITTEE ON FOREIGN INVESTMENT IN 
              THE UNITED STATES OF CERTAIN TRANSACTIONS.

    Section 721(b) of the Defense Production Act of 1950 (50 U.S.C. 
4565(b)) is amended by adding at the end the following:
            ``(9) Approval required for certain transactions.--
                    ``(A) In general.--A covered transaction described 
                in subparagraph (C) is prohibited unless the 
                Committee--
                            ``(i) reviews the transaction under this 
                        subsection; and
                            ``(ii) determines that the transaction does 
                        not pose a risk to the national security of the 
                        United States.
                    ``(B) Mitigation.--The Committee, or a lead agency 
                on behalf of the Committee, may negotiate, enter into 
                or impose, and enforce an agreement or condition under 
                subsection (l)(3) with any party to a covered 
                transaction described in subparagraph (C) to mitigate 
                any risk to the national security of the United States 
                that arises as a result of the covered transaction.
                    ``(C) Covered transaction described.--A covered 
                transaction described in this subparagraph is a 
                transaction that could result in foreign control of a 
                United States company--
                            ``(i) that collects, sells, buys, or 
                        processes user data (as defined in section 2 of 
                        the National Security and Personal Data 
                        Protection Act of 2019) and whose business 
                        consists substantially more of transferring 
                        data than manufacturing, delivering, repairing, 
                        or servicing physical goods or providing 
                        physical services; or
                            ``(ii) that operates a social media 
                        platform or website.''.
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