NetChoice Identifies the Worst Proposed Internet Laws in America

iAWFUL (Internet Advocates’ Watchlist For Ugly Laws) Tracks the Most Dangerous Proposals and Rallies Users to Oppose Them

WASHINGTON, DC, June 9, 2009 — With reckless and misguided regulation threatening to undermine the foundations of a free and open Internet, NetChoice today launched a new initiative to track dangerous legislation and mobilize citizens in defense of core Internet principles.

The Internet Advocates’ Watchlist For Ugly Laws (iAWFUL) identifies America’s 10 worst legislative and regulatory proposals targeted at the Internet. The iAWFUL Web site (http://www.iAWFUL.com) urges Internet users to join the fight against truly bad bills that threaten the future of e-commerce and online communication. The list will be regularly updated to reflect the most immediate dangers, based on regulatory severity and likelihood of passage.

“Some of the most serious threats to the Internet arise when lawmakers try to ‘fix’ it,” Steve DelBianco, Executive Director of NetChoice said. “Knee-jerk, overly prescriptive laws can destroy whole business models or stifle innovations in e-commerce and communication before they even have a chance to prove themselves. Too many laws are proposed without considering unintended harms they may cause to thousands of Internet companies and millions of Internet users.”

Bad Internet Regulation Is Often Born in State Capitals

State legislation and regulation account for the majority of entries on the iAWFUL least-wanted list. It’s a stark indication of the growing push in states to regulate and tax nearly every aspect of online behavior. Such efforts are not new, but have grown in frequency and severity in recent years, DelBianco said.

“In many state legislatures, a bad idea can become the law in just a few weeks, without any opportunity for the Internet community to comment and raise concerns,” DelBianco said. “Internet advocates understand the importance of protecting consumers while encouraging innovation, but they can’t possibly track what’s happening in so many states. While most bad bills die quietly, iAWFUL will draw attention to worst of what’s still moving through state capitals.”

The Inaugural iAWFUL Top Ten Unveiled

Topping the inaugural iAWFUL list is New Jersey’s Social Networking Bill (A 3757), which would force a large number of websites to become law enforcement investigators. This unprecedented bill imposes civil and Consumer Fraud Act penalties on social networking websites for failure to promptly investigate and report to law enforcement a user’s complaint of sexually offensive and harassing communications. As noble as this may sound, this proposed law has serious unintended consequences:

  • Has one state regulating the Internet. The bill would apply to any website located on the Internet where users located in New Jersey can create a searchable personal profile, page or similar account that is accessible to other users. This creates new legal liabilities for any website on the Internet, including many medical, travel and community sites that have user profile functionality.
  • Would impose a massive compliance burden on smaller, upcoming services that are often free of charge for users. This would cause small sites to fail, because only the largest sites could afford the implementation costs or potential legal liability.
  • Creates a false sense of security for users of the site and for parents of younger users. If a communication is truly harassing or makes people fear for their lives, they should go to law enforcement—911 should be the response, not www.
  • Contrary to the spirit of existing Federal law that does not hold websites liable as publishers, the bill would chill free speech and could be abused by those with extreme views to overwhelm sites with accusations of harassing communications.

Among the other bills making the iAWFUL top ten include two each from Connecticut and North Carolina, the only two states to make the list more than once. Here are the other (dis)honorees, which run the gamut from bills that would penalize environmentally friendly digital download purchases, to those that would hobble the use of online marketplaces by consumers looking for better prices, to those that would harm local businesses, including local media, who rely on online affiliate advertising:

  1. California Social Networking Bill (AB 632) – What’s AWFUL? It’s a tech mandate that can be abused to stifle free speech.
  2. Connecticut Tax Bill (SB 806) – What’s AWFUL? It confuses Web 2.0 advertising for a traditional sales force.
  3. North Carolina Tickets Bill (SB 99) – What’s AWFUL? It taxes the Internet (and only the Internet) resale of tickets.
  4. Connecticut Internet Resellers Amendment (SB 1002)– What’s AWFUL? It discriminates against the Internet (only) and allows unwarranted search of people’s homes.
  5. Federal Bills on Organized Retail Crime – What’s AWFUL? They create extraordinary burdens on online marketplaces.
  6. Nevada Encryption Bill (SB 227) – What’s AWFUL? It mandates a one-size fits all tech standard for data security.
  7. Texas Security Breach Bill (HB 345 & SB 327) – What’s AWFUL? It transforms business and technology standards into legislative mandates, harming innovation and the next generation of security technology.
  8. New York Online Employment Services Taxation Issue – What’s AWFUL? Discriminates against Internet services that help people find jobs by treating them as mere information services, which are subject to taxation.
  9. North Carolina Digital Downloads Tax Bill (HB 558/S 487) – What’s AWFUL? It discourages the greenest way to purchase music and other content.

Using the iAWFUL website and Twitter (@NetChoice), NetChoice will routinely review and update iAWFUL as new bills are introduced, and others are defeated or altered.