Reed Smith Client Alerts

As data privacy remains top of mind for both consumers and lawmakers on both sides of the Atlantic, a recent draft bill introduced in both the House and Senate – dubbed the Banning Surveillance Advertising Act (“BSAA”) – should serve as both a cautionary warning to online marketers and an impetus to begin proactively thinking about how current business models need to change in response.
Shopping online concept - shopping cart or trolley on a laptop keyboard.

Introduced by Representatives Anna Eshoo (D-CA) and Jan Schakowsky (D-IL) in the U.S. House of Representatives and Cory Booker (D-NJ) in the U.S. Senate, the BSAA seeks to provoke a radical shift in the online advertising landscape by completely prohibiting advertisers – subject to a few exceptions – from targeting consumers with ads. While not likely to pass, the bill would endow the Federal Trade Commission (FTC) and state attorneys general (AGs) with enforcement authority while creating a private right of action, significantly ratcheting up potential risks – such as uncapped monetary fines – to businesses situated in the online advertising space.

Say goodbye to third-party data

In short, the bill seeks to:

  • Prevent advertising networks and facilitators – firms that publish advertisements – from using any data linked or reasonably linkable to an individual for the purposes of targeted advertising.
  • Prohibit advertisers from targeting or causing an advertising facilitator to target ads based on (i) third-party data and (ii) protected class information such as race, gender, and religion.

Notably, the only forms of targeted advertising excluded from this sweeping proscription would be (a) contextual advertisements based on information the consumer is actually engaging with, and (b) broad location targeting, which would permit targeted advertisements towards “recognized places” such as congressional districts and TV markets.

Moreover, marking a stark departure from the consent-based frameworks adopted by other comprehensive privacy laws, such as the California Consumer Privacy Act (CCPA) and the General Data Privacy Regulation (GDPR), the bill would completely remove the consumer from the decision-making process, banning targeted advertising regardless of whether a consumer grants their consent.