Title: KIDS Act
Policy area: Commerce

Summary:
Kids Internet Design and Safety Act or the KIDS Act  This bill prohibits commercial online platforms that are directed to children from engaging in certain practices, including implementing features that encourage additional engagement with the platform, promoting certain types of content, and using certain advertising methods.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8372 Introduced in House (IH)]

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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 
                    Committee 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 Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Kids Internet Design and Safety 
Act'' or the ``KIDS Act''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) Children increasingly consume digital entertainment on 
        the internet and are uniquely susceptible to manipulation 
        online, given their lack of important neurological and 
        psychological mechanisms which are developed later in 
        adulthood.
            (2) Today's digital media environment, which is constantly 
        evolving and now includes high-tech experiences, such as 
        augmented reality and virtual reality, is largely designed in 
        non-transparent ways to ensure children interact with content 
        that reflect the interests and goals of content creators, 
        platforms, and marketers.
            (3) Artificial intelligence, machine learning, and other 
        complex systems are used to make continuous decisions about how 
        online content for children can be personalized to increase 
        engagement.
            (4) Online companies gather, analyze, and use data for 
        behavioral marketing directed at children.
            (5) Companies employ sophisticated strategies, including 
        neuromarketing, to affect consumer behavior and manipulate 
        decision making.
            (6) Branded content in various forms of multimedia, 
        including native advertising and influencer marketing, exposes 
        children to marketing that is inherently manipulative or 
        purposely disguised as entertainment or other information.

SEC. 3. DEFINITIONS.

    (a) In General.--In this Act:
            (1) Augmented reality.--The term ``augmented reality'' 
        means an application or web-based experience utilizing a camera 
        to change or enhance the user's view of the real world.
            (2) Branded content.--The term ``branded content'' means 
        commercial content created for, and distributed on, a platform 
        in such a way that the line between entertainment and 
        advertising becomes unclear in order to generate a positive 
        view of the brand.
            (3) Commission.--The term ``Commission'' means the Federal 
        Trade Commission.
            (4) Covered user.--The term ``covered user'' means an 
        individual under the age of 16.
            (5) Directed to children.--The term ``directed to 
        children'' means the targeting of covered users by a platform, 
        as demonstrated by, with respect to such platform--
                    (A) its subject matter;
                    (B) its visual content;
                    (C) the use of animated characters or child-
                oriented activities for children and related 
                incentives;
                    (D) music or other audio content;
                    (E) the age of models used;
                    (F) the presence of--
                            (i) child celebrities; or
                            (ii) celebrities who appeal to covered 
                        users;
                    (G) the language used;
                    (H) advertising content used on, or used to 
                advertise, such platform; or
                    (I) reliable empirical evidence relating to--
                            (i) the composition of the audience of such 
                        platform; and
                            (ii) the intended audience of such 
                        platform.
            (6) Host-selling.--The term ``host-selling'' refers to 
        commercial video content that features the same characters or 
        individuals as in the adjacent noncommercial content.
            (7) Influencer marketing.--The term ``influencer 
        marketing'' means a tactic by which a brand or agency or 
        publisher works with individuals who are deemed to have the 
        potential to create engagement, drive conversation, or sell 
        products or services with the intended target audience, in 
        order to drive brand messages.
            (8) Manipulation.--The term ``manipulation'' means design 
        strategies, product settings, and product architecture targeted 
        to cognitive vulnerabilities with the intention or effect of 
        pushing the user to make choices to their detriment and the 
        operator's benefit.
            (9) Native advertising.--The term ``native advertising'' 
        means a form of paid media where the advertising experience 
        follows the natural form and function of the user experience in 
        which it is placed.
            (10) Neuromarketing.--The term ``neuromarketing'' means a 
        subfield of marketing that attempts to predict and potentially 
        manipulate consumer behavior and decision making based on 
        analysis of brain patterns.
            (11) Operator.--
                    (A) In general.--The term ``operator'' means any 
                person who operates a platform, including any person 
                offering products or services for sale through that 
                platform, involving commerce--
                            (i) among the several States or with one or 
                        more foreign nations;
                            (ii) in any territory of the United States 
                        or in the District of Columbia, or between any 
                        such territory and--
                                    (I) another such territory; or
                                    (II) any State or foreign nation; 
                                or
                            (iii) between the District of Columbia and 
                        any State, territory, or foreign nation.
                    (B) Exception.--The term ``operator'' does not 
                include any nonprofit entity that would otherwise be 
                exempt from coverage under section 5 of the Federal 
                Trade Commission Act (15 U.S.C. 45).
            (12) Person.--The term ``person'' means any individual, 
        partnership, corporation, trust, estate, cooperative, 
        association, or other entity.
            (13) Platform.--The term ``platform'' means a website, 
        online service, online application, or mobile application which 
        is operated for commercial purposes.
            (14) Virtual reality.--The term ``virtual reality'' means 
        an application or web-based experience utilizing a camera to 
        create an immersive environment that mimics the real world, 
        usually via a headset.

SEC. 4. REGULATION OF ACTS AND PRACTICES ON CHILD-DIRECTED PLATFORMS.

    (a) Prohibition on Certain Features.--It is unlawful for an 
operator of a platform directed to children to incorporate any of the 
following features:
            (1) Any auto-play setting that, without input from the 
        covered user, commences additional video content directly 
        following the video content initially selected by the user.
            (2) Push alerts that urge a covered user to spend more time 
        engaged with the platform when they are not actively using it.
            (3) Displaying the quantity of positive engagement or 
        feedback that a covered user has received from other users.
            (4) Any design feature or setting that unfairly encourages 
        a covered user, due to their age or inexperience, to make 
        purchases, submit content, or spend more time engaging with the 
        platform.
            (5) Any feature that provides a covered user with badges or 
        other visual award symbols based on elevated levels of 
        engagement with the platform.
    (b) Prohibition on Amplification of Certain Content; User Reporting 
Mechanism.--It shall be unlawful for an operator of a platform directed 
to children, or a platform for which the operator has constructive 
knowledge that covered users use its platform, to--
            (1) amplify, promote, or encourage covered users' 
        consumption of videos and other forms of content that involve--
                    (A) sexual material;
                    (B) physical or emotional violence, including 
                bullying;
                    (C) adult activities, including gambling; or
                    (D) other dangerous, abusive, exploitative, or 
                wholly commercial content; or
            (2) fail to implement a mechanism for users to report 
        suspected violations of any requirement under paragraph (1).
    (c) Prohibition on Certain Advertising Methods.--
            (1) In general.--It shall be unlawful for an operator of a 
        platform directed to children to--
                    (A) direct content that includes host-selling to 
                covered users;
                    (B) expose covered users to program-length 
                advertisements;
                    (C) direct branded content or native advertising to 
                covered users;
                    (D) direct online advertising or material with 
                considerable commercial content involving alcohol, 
                nicotine, or tobacco to covered users;
                    (E) expose covered users to online advertising or 
                material with considerable commercial content with any 
                imbedded interactive elements that take advantage of 
                covered users' inexperience or credulity in 
                noncommercial child-directed content; or
                    (F) direct content that includes product placement 
                to covered users.
            (2) Program-length advertisement.--The term ``program-
        length advertisement'' shall be defined by the Commission 
        through regulation or other public guidance.
    (d) Prohibition on Use of Personal Information.--It shall be 
unlawful for an operator of a platform directed to children to use age 
verification information collected from covered users for any 
commercial purpose.
    (e) Regulations.--The Commission shall promulgate regulations in 
accordance with section 553 of title 5, United States Code, to require 
any operator of a platform directed to children to incorporate online 
visual elements or other indicators that distinguish commercial content 
from noncommercial content.

SEC. 5. MARKETING AND COMMERCIALIZATION.

    (a) Content Labeling System Report.--Not later than the date that 
is 1 year after the date of enactment of this Act, the Commission shall 
submit to Congress a report--
            (1) containing recommendations for a labeling system to 
        allow parents to identify noncommercial, educational, and 
        enriching content for covered users online; and
            (2) address considerations regarding how such labeling 
        system should--
                    (A) analyze content based on evidence-based 
                criteria;
                    (B) employ an easy-to-understand visual cue for 
                parents to identify content described in paragraph (1);
                    (C) receive regular review to determine its 
                effectiveness; and
                    (D) develop a mechanism for users to report to the 
                Commission complaints of mislabeled content and for the 
                Commission to remedy such instances of mislabeled 
                content.
    (b) Consultation.--The report described in subsection (a) shall be 
developed by the Commission in consultation with an advisory board, to 
be created and convened by the Commission, which is comprised of 
experts in child development, child health, education, and media.

SEC. 6. TRANSPARENCY AND AUDITING.

    (a) Transparency.--The Commission shall promulgate regulations in 
accordance with section 553 of title 5, United States Code, requiring 
an operator of a platform which is directed to children to publish and 
maintain a publicly accessible digital record of the viewable or 
playable content of each such platform.
    (b) Annual Platform Audits.--The regulations promulgated pursuant 
to subsection (a) shall include the establishment of an annual audit 
process, to be conducted during the 5-year period subsequent to the 
date of enactment of this Act, for each of the 25 platforms directed to 
children with the highest total number of child users, to evaluate the 
level of compliance by each such platform with respect to the 
requirements under this Act.
    (c) Report.--The Commission shall issue annual reports to Congress 
based on the audits described in subsection (b) that--
            (1) describe the level of compliance by the platforms 
        described in such subsection with respect to the requirements 
        under this Act; and
            (2) provide recommendations for such legislation and 
        administrative actions as the Commission determines appropriate 
        based on the audit findings.

SEC. 7. GRANT PROGRAM.

    (a) Establishment.--
            (1) In general.--The Secretary of Commerce shall provide 
        grants to eligible persons to foster the creation and promotion 
        of advertisement-free and educational online content for 
        covered users, such as videos and applications.
            (2) Eligible person.--For purposes of this section, the 
        term ``eligible person'' means a person that has submitted an 
        application, as approved by the Secretary of Commerce pursuant 
        to the eligibility requirements developed under subsection (b), 
        for the creation and promotion of advertisement-free and 
        educational online content for covered users.
    (b) Advisory Council.--The Secretary shall establish and convene an 
Advisory Council on Children's Online Content, which shall be--
            (1) comprised of experts in education, child development, 
        psychology, online media, and other related disciplines; and
            (2) tasked with developing evidence-based criteria for 
        grant eligibility and grant distribution.
    (c) Authorization of Appropriations.--
            (1) In general.--To carry out this section, there is 
        authorized to be appropriated--
                    (A) for fiscal year 2021, $4,000,000;
                    (B) for fiscal year 2022, $8,000,000;
                    (C) for fiscal year 2023, $10,000,000; and
                    (D) for fiscal year 2024, $12,000,000.
            (2) Availability of funds.--Any amount appropriated under 
        this subsection for any fiscal year shall remain available for 
        the purposes of carrying out any application approved during 
        such fiscal year for an additional period of 1 year after the 
        end of such fiscal year.

SEC. 8. ADMINISTRATION AND ENFORCEMENT.

    (a) In General.--This Act shall be enforced by the Commission under 
the Federal Trade Commission Act (15 U.S.C. 41 et seq.).
    (b) Actions by Commission.--
            (1) In general.--The Commission shall prevent any person 
        from violating this Act or any regulation promulgated by the 
        Commission under this Act 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.
            (2) Penalties and privileges.--Any person that violates 
        this Act or any regulation promulgated under the Act shall be 
        subject to the penalties and entitled to the privileges and 
        immunities provided in the Federal Trade Commission Act in the 
        same manner, by the same means, and with the same jurisdiction, 
        power, and duties, as though all applicable terms and 
        provisions of the Federal Trade Commission Act were 
        incorporated into and made a part of this Act.
    (c) Civil Penalty.--A violation of the Act, or a rule promulgated 
under the Act, 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)).
    (d) Effect on Other Laws.--Nothing contained in this Act shall be 
construed to limit the authority of the Commission under any other 
provisions of law.
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