Washington Report

Keeping Members Informed About Regulatory Issues

Contents
April 2000

INTERNET ISSUES

COPPA REGS NOW IN EFFECT

Anyone attempting to collect information from children under 13 online must now comply with the Federal Trade Commission's regulations implementing the Children's Online Privacy Protection Act (COPPA), which require parental consent for such activities. There is a compliance guide on the FTC web site (www.ftc.gov), and The DMA is working with the FTC to produce a written compliance guide. We will notify you when our guide is available.

INTERNET TAX ACT INTRODUCED

Stating that new taxes could imperil the booming Internet economy, Senator Judd Gregg (R-NH) and Senator Herb Kohl (D-WI) have introduced bipartisan legislation to prevent states from forcing out-of-state businesses to collect sales tax on their behalf. The bill is called the "New Economy Tax Simplification Act" (NETSA).

The bill is intended to apply to e-commerce the same protection provided by the Quill decision to other kinds of direct marketing. The legislation ensures that nexus would not be established by intangible sales, web pages, or servers, or the use of independent contractors or representatives for warranty or repair services.

If you would like more details on this bill, contact Elizabeth Scanlon at 202-861-2418 or escanlon@the-dma.org.

ONLINE PRIVACY REPORT RELEASED

Online consumers are less concerned with revealing personal information online, than they are with how companies use the information collected, according to a new survey from Cyber Dialogue.

The report of 1,500 Internet users found that 69% have unknowingly signed up for email lists and more than 40% of users don't know about cookies or how they work. The study also reveals that 80% of Web users will divulge personal information such as name, education level, age and hobbies in exchange for customized content.

Other Cyber Dialogue findings:

• More than 95% of Internet users have received unsolicited email.
• 21% of Internet users are not sure what their browsers are set to when it comes to cookies, down from 50% in 1997.
• 74% of online users who received unsolicited email took action to be removed from the offending senders' email list.
• 71% of Internet users personalize a Web site to receive more relevant content, especially local info such as weather, movie listings and community calendars.

More Info: http://www.cyberdialogue.com/pdfs/wp/wp-cd-2000-privacy.pdf Contact: Grant Sanborn, 212-651-7047, gsanborn@cyberdialogue.com

DIGITAL SIGNATURES BILL NEARS PASSAGE

The Association for Interactive Media (AIM), a DMA subsidiary, reports that Congress is in the final stages of passing a digital signatures law that would allow two parties to sign and send legally binding documents through computers. A digital signature turns information into a secret code that only participating parties can unscramble.

The House and Senate have each passed their own versions of the bill, and a final compromise bill might be passed by Congress and signed into law before this summer's recess. President Clinton is expected to sign the bill if it passes.

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