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United States Privacy Digest | Notes from the IAPP, June 24, 2022 Related reading: Notes from the IAPP, June 17, 2022

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Greetings from Portsmouth, New Hampshire!

U.S. Congress continues to chug along with its work on federal privacy legislation at a surprisingly quick and robust pace. Thursday's House Committee on Energy and Commerce markup of the American Data Privacy and Protection Act shows at least one chamber has enough consensus to move along in the legislative process. Compromise remains to be seen in the Senate, where stalemates loom large.

While all eyes are on potential legislation, the longtime sidecar to a federal law has re-emerged. The Federal Trade Commission quietly refiled its Advanced Notice of Proposed Rulemaking for privacy and AI earlier this month after a pre-filing in December 2021 wasn't followed through on. Stakeholder comments on the ANPRM are due sometime in August, though that deadline may be open-ended.

After the news broke, I spoke with a handful of folks with knowledge of the FTC's procedures and workings. One source said the current dates and timeline attached to the ANPRM have "no bearing on the timeline for releasing a rule." These current dates amount to placeholders, so worries and anxiety over rulemaking in the near future can simmer.

But the filing does raise the question of what the FTC is lining itself up for, with or without federal legislation. All the sources I spoke with agreed that the FTC is getting its ducks in a row for a potential swing-and-miss by Congress on federal legislation, with one source calling it "a type of insurance" the commission can immediately turn back to and run with. There will be no balancing act between rulemaking and legislation besides targeted Administrative Procedure Act rulemaking authority for the FTC provided by a federal law. Any move for rulemaking on top of a law would be "viewed quite poorly" by federal lawmakers, according to a source.

So where do we stand with rulemaking if current Congressional talks on a law fall through? Well, the commission might be planning the safety net but it's not supported across the board. The FTC's Democratic majority — thanks to Alvaro Bedoya's long-awaited confirmation as FTC commissioner — will allow a rulemaking package to forge ahead despite Republican opposition. The previous partisan split without Bedoya could explain why the commission let last year's initial crack at kickstarting rulemaking slip by the wayside.

With an eye toward bipartisanship, one source said a potential consensus avenue could lie with privacy rulemaking over "prohibited conduct that could not reasonably be considered legitimate business activity."

What's clear at this point is the appetite for tackling privacy in Washington, D.C., has never been larger. The bad news is the answer to fulfilling that appetite likely isn't as close as lawmakers and stakeholders hope. 

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