KIDS Act Seeks to Expand Online Protections for Children Under 16

On September 30, 2021, Senators Ed Markey (D-MA) and Richard Blumenthal (D-CT) and Representative Kathy Castor (D-FL) introduced S.2918, the Kids Internet Design and Safety (KIDS) Act, which would expand online protections for children beyond what the Children's Online Privacy Protection Act (COPPA) currently provides.

While COPPA and the COPPA Rule are concerned with the collection of personal information from children under 13, the KIDS Act seeks to regulate the online experience for children under 16. If enacted, the Act would require online platforms directed to users under 16 ("users"), or that have "actual or constructive knowledge" that users are under 16, to comply with (i) design limitations, (ii) content restrictions, (iii) marketing rules, and (iv) data use limitations.

• Design Limitations
  

  The KIDS Act would prohibit:

  • Auto-play settings;
  • Alerts encouraging an inactive user to engage;
  • Displaying "likes" or other quantitative engagement indicators;
  • "Unfairly" encouraging a user to share personal information, content, or spend more time on the platform;
  • Offering badges or other awards for engagement; and
  • Features encouraging spending.
  
  The Federal Trade Commission (FTC) may add to these limitations and create exceptions only when necessary to provide essential functionality and if aligned with the user's best interests.
• Content Restrictions
  

  Online platforms may not use algorithms that promote consumption of content that is "non-educational" and that involves sexual material, promotion of physical or emotional violence resulting in physical or emotional harm (including self-harm, use of weapons and bullying), unlawful activities, or "wholly commercial content" that a user would not recognize as commercial.

• Marketing Rules
  

  Online platforms also could not use algorithms to direct advertising to children that includes certain prohibited content or marketing strategies, such as "host-selling" (commercial content featuring the same characters as adjacent non-commercial content), program-length advertisements, influencer marketing, material regarding certain substances (alcohol, nicotine, or tobacco), embedded interactive elements that take advantage of a user's inexperience, or content that includes product placement.

• Data Use Limitations
  

  Online platforms could not use age verification information collected from users for a commercial purpose if the platform is directed to children or the operator knows the user is under 16.

FTC Enforcement

The KIDS Act would be enforced by the FTC, with violations of the Act considered an unfair or deceptive practice under the FTC Act. The bill would also permit state attorneys general to bring civil actions to enforce the KIDS Act.

The KIDS Act would give significant rulemaking latitude to the FTC, and identifies particular areas for rulemaking, including key definitions in the statute, recordkeeping requirements regarding the content on every online platform, and an annual audit process for online platforms with the highest number of users.

The FTC would also generate (i) a report to Congress recommending a "labeling system" to identify non-commercial, educational, and "enriching" content for users under 16, and (ii) a study on harms on online platforms directed to children.