Insight

FCC Stays ISP Privacy and Cybersecurity Rules in Favor of FTC Approach to Privacy Regulation

Attorney Brief: FCC Stays ISP Privacy
AJ

Aaron George and Laura Jehl

March 27, 2017 01:27 PM

Last October, in a vote split along party lines, the Federal Communications Commission (FCC) under then-chairman Tom Wheeler approved a new regulatory regime staking the FCC’s claim to aggressive privacy and cybersecurity regulation of Internet service providers (ISPs). The privacy and cybersecurity rules followed the FCC’s 2015 decision in the Open Internet Order (known as net neutrality) to classify broadband Internet access service as a telecommunications service under Title II of the Communications Act.

One effect of the FCC’s 2015 Open Internet Order was to remove the Federal Trade Commission’s (FTC) oversight of ISPs by classifying them as common carriers exempted from Section 5 of the FTC Act. The FCC’s new privacy regime thus sought to fill the privacy gap left by the agency’s classification decision, but the FCC’s privacy rules went far beyond the guidelines established by the FTC. The FCC’s rules would firmly establish the FCC as the toughest privacy regulator in the Internet ecosystem by imposing significantly more onerous and restrictive requirements for use and collection of consumer data on ISPs than the FTC imposed on their non-ISP competitors who also collect, use, and share consumer data.

The FCC’s privacy rules share some characteristics with the FTC’s longstanding regulation in this space, including requiring fixed ISPs and mobile data carriers that offer broadband services to obtain affirmative opt-in consent from consumers prior to using, sharing, or selling sensitive information. The FCC’s definition of sensitive information, however, is far more expansive than the FTC’s definition and includes geolocation information, web browsing, and app usage history in addition to the health and financial information considered sensitive by the FTC. Under the FCC’s rules, consumers would be entitled to opt out and prevent ISPs from using and sharing on sensitive individually identifiable customer information as well. The FCC rules also require ISPs to provide customers with information about their collection, use, and sharing of consumer data to comply with additional protocols, protect consumer information, and adhere to new notification protocols in the event of a data breach that includes consumer information.

The FCC’s rules are on the books now, with the substantive requirements scheduled to take effect in stages over the course of 2017. Several parties have filed petitions for reconsideration that are currently pending before the agency.

Following the change in administration and the ascendancy of new FCC chairman, Ajit Pai, the status of the FCC’s new privacy regime (and the agency’s decision to classify ISPs as common carriers under Title II) is in question. On March 1, 2017, the FCC entered an interim stay of the new rules related to data security, which were set to take effect on March 2, 2017, pending the agency’s resolution of the petitions for reconsideration. The FCC did not stay other aspects of the new rules, which have not yet taken effect. The same day, Chairman Pai and acting FTC Chairman Maureen Ohlhausen released a joint statement announcing their belief that the FTC should be restored as the privacy regulator for ISPs (which would require reclassifying ISPs as non-common carriers) and that, in the meantime, the FCC’s privacy rules should be harmonized with the FTC’s standards applicable to other companies in the Internet ecosystem.

It remains to be seen whether and how the FCC ultimately will revise its privacy and cybersecurity rules to align with the FTC’s standards. To the extent it is able to do so, the FCC’s approach could prove a useful template for other agencies seeking to harmonize their privacy and cybersecurity regulations with the FTC’s standards. The FCC’s approach also could serve as a valuable compass for other industries hoping for clear and uniform privacy and cybersecurity requirements across their various federal regulators.

Trending Articles

2025 Best Lawyers Awards Announced: Honoring Outstanding Legal Professionals Across the U.S.


by Jennifer Verta

Introducing the 31st edition of The Best Lawyers in America and the fifth edition of Best Lawyers: Ones to Watch in America.

Digital map of the United States illuminated by numerous bright lights.

Unveiling the 2025 Best Lawyers Awards Canada: Celebrating Legal Excellence


by Jennifer Verta

Presenting the 19th edition of The Best Lawyers in Canada and the 4th edition of Best Lawyers: Ones to Watch in Canada.

Digital map of Canadathis on illuminated by numerous bright lights

Discover The Best Lawyers in Spain 2025 Edition


by Jennifer Verta

Highlighting Spain’s leading legal professionals and rising talents.

Flags of Spain, representing Best Lawyers country

Unveiling the 2025 Best Lawyers Editions in Brazil, Mexico, Portugal and South Africa


by Jennifer Verta

Best Lawyers celebrates the finest in law, reaffirming its commitment to the global legal community.

Flags of Brazil, Mexico, Portugal and South Africa, representing Best Lawyers countries

Presenting the 2025 Best Lawyers Editions in Chile, Colombia, Peru and Puerto Rico


by Jennifer Verta

Celebrating top legal professionals in South America and the Caribbean.

Flags of Puerto Rico, Chile, Colombia, and Peru, representing countries featured in the Best Lawyers

Prop 36 California 2024: California’s Path to Stricter Sentencing and Criminal Justice Reform


by Jennifer Verta

Explore how Prop 36 could shape California's sentencing laws and justice reform.

Illustrated Hands Breaking Chains Against a Bright Red Background

Tampa Appeals Court ‘Sends Clear Message,” Ensuring School Tax Referendum Stays on Ballot


by Gregory Sirico

Hillsborough County's tax referendum is back on the 2024 ballot, promising $177 million for schools and empowering residents to decide the future of education.

Graduation cap in air surrounded by pencils and money

Find the Best Lawyers for Your Needs


by Jennifer Verta

Discover how Best Lawyers simplifies the attorney search process.

A focused woman with dark hair wearing a green top and beige blazer, working on a tablet in a dimly

Paramount Hit With NY Class Action Lawsuit Over Mass Layoffs


by Gregory Sirico

Paramount Global faces a class action lawsuit for allegedly violating New York's WARN Act after laying off 300+ employees without proper notice in September.

Animated man in suit being erased with Paramount logo in background

The Human Cost


by Justin Smulison

2 new EU laws aim to reshape global business by enforcing ethical supply chains, focusing on human rights and sustainability

Worker wearing hat stands in field carrying equipment

Introduction to Demand Generation for Law Firms


by Jennifer Verta

Learn the essentials of demand gen for law firms and how these strategies can drive client acquisition, retention, and long-term success.

Illustration of a hand holding a magnet, attracting icons representing individuals towards a central

Social Media for Law Firms: The Essential Beginner’s Guide to Digital Success


by Jennifer Verta

Maximize your law firm’s online impact with social media.

3D pixelated thumbs-up icon in red and orange on a blue and purple background.

ERISA Reaches Its Turning Point


by Bryan Driscoll

ERISA litigation and the laws surrounding are rapidly changing, with companies fundamentally rewriting their business practices.

Beach chair and hat in front of large magnify glass

How Client Testimonials Fuel Client Acquisition for Law Firms


by Nancy Lippincott

Learn how client testimonials boost client acquisition for law firms. Enhance credibility, engage clients and stand out in a competitive legal market.

Woman holding blurb of online reviews

Best Lawyers Expands With New Artificial Intelligence Practice Area


by Best Lawyers

Best Lawyers introduces Artificial Intelligence Law to recognize attorneys leading the way in AI-related legal issues and innovation.

AI network expanding in front of bookshelf

Critical Period


by Armelle Royer and Maryne Gouhier

How the green-energy raw materials chase is rewriting geopolitics

Overhead shot of mineral extraction plant