Further Reading, Other Developments, and Coming Events (11 January 2021)

Further Reading

  • Why the Russian hack is so significant, and why it’s close to a worst-case scenario” By Kevin Collier — NBC News. This article quotes experts who paint a very ugly picture for the United States (U.S.) in trying to recover from the Russian Federation’s hack. Firstly, the Russians are very good at what they do and likely built multiple backdoors in systems they would want to ensure they have access to after using SolarWinds’ update system to gain initial entry. Secondly, broadly speaking, at present, U.S. agencies and companies have two very unpalatable options: spend months hunting through their systems for any such backdoors or other issues or rebuild their systems from scratch. The ramifications of this hack will continue to be felt well into the Biden Administration.
  • The storming of Capitol Hill was organized on social media.” By Sheera Frenkel — The New York Times. As the repercussions of the riot and apparently attempted insurrection continue to be felt, one aspect that has received attention and will continue to receive attention is the role social media platforms played. Platforms used predominantly by right wing and extremist groups like Gab and Parler were used extensively to plan and execute the attack. This fact and the ongoing content moderation issues at larger platforms will surely inform the Section 230 and privacy legislation debates expected to occur this year and into the future.
  • Comcast data cap blasted by lawmakers as it expands into 12 more states” By Jon Brodkin — Ars Technica. Comcast has extended to other states its 1.2TB cap on household broadband usage, and lawmakers in Massachusetts have written the company, claiming this will hurt low-income families working and schooling children at home. Comcast claims this affects only a small class of subscribers, so-called “super users.” Such a move always seemed in retrospect as data is now the most valuable commodity.
  • Finnish lawmakers’ emails hacked in suspected espionage incident” By Shannon Vavra — cyberscoop. Another legislature of a democratic nation has been hacked, and given the recent hacks of Norway’s Parliament and Germany’s Bundestag by the Russians, it may well turn out they were behind this hack that “obtain[ed] information either to benefit a foreign state or to harm Finland” according to Finland’s National Bureau of Investigation.
  • Facebook Forced Its Employees To Stop Discussing Trump’s Coup Attempt” By Ryan Mac — BuzzFeed News. Reportedly, Facebook shut down internal dialogue about the misgivings voiced by employees about its response to the lies in President Donald Trump’s video and the platform’s role in creating the conditions that caused Trump supporters to storm the United States (U.S.) Capitol. Internally and externally, Facebook equivocated on whether it would go so far as Twitter in taking down Trump’s video and content.
  • WhatsApp gives users an ultimatum: Share data with Facebook or stop using the app” By Dan Goodin — Ars Technica. Very likely in response to coming changes to the Apple iOS that will allow for greater control of privacy, Facebook is giving WhatsApp users a choice: accept our new terms of service that allows personal data to be shared with and used by Facebook or have your account permanently deleted.
  • Insecure wheels: Police turn to car data to destroy suspects’ alibis” By Olivia Solon — NBC News. Like any other computerized, connected device, cars are increasingly a source law enforcement (and likely intelligence agencies) are using to investigate crimes. If you sync your phone via USB or Bluetooth, most modern cars will access your phone and store all sorts of personal data that can later be accessed. But, other systems in cars can tell investigators where the car was, how heavy it was (i.e. how many people), when doors opened, etc. And, there are not specific federal or state laws in the United States to mandate protection of these data.

Other Developments

  • The Federal Bureau of Investigation (FBI), the Cybersecurity and Infrastructure Security Agency (CISA), the Office of the Director of National Intelligence (ODNI), and the National Security Agency (NSA) issued a joint statement, finally naming the Russian Federation as the likely perpetrator of the massive SolarWinds hack. However, the agencies qualified the language, claiming:
    • This work indicates that an Advanced Persistent Threat (APT) actor, likely Russian in origin, is responsible for most or all of the recently discovered, ongoing cyber compromises of both government and non-governmental networks. At this time, we believe this was, and continues to be, an intelligence gathering effort.
      • Why the language is not more definitive is not clear. Perhaps the agencies are merely exercising caution about whom is blamed for the attack. Perhaps the agencies do not want to anger a White House and President averse to reports of Russian hacking for fear it will be associated with the hacking during the 2016 election that aided the Trump Campaign.
      • However, it is noteworthy the agencies are stating their belief the hacking was related to “intelligence gathering,” suggesting the purpose of the incursions was not to destroy data or launch an attack. Presumably, such an assertion is meant to allays concerns that the Russian Federation intends to attack the United States (U.S.) like it did in Ukraine and Georgia in the last decade.
    • The Cyber Unified Coordination Group (UCG) convened per Presidential Policy Directive (PPD) 41 (which technically is the FBI, CISA, and the ODNI but not the NSA) asserted its belief that
      • of the approximately 18,000 affected public and private sector customers of SolarWinds’ Orion products, a much smaller number has been compromised by follow-on activity on their systems. We have so far identified fewer than 10 U.S. government agencies that fall into this category, and are working to identify the nongovernment entities who also may be impacted.
      • These findings are, of course, preliminary, and there may be incentives for the agencies to be less than forthcoming about what they know of the scope and impact of the hacking.
  • Federal Communications Commission (FCC) Chair Ajit Pai has said he will not proceed with a rulemaking to curtail 47 USC 230 (Section 230) in response to a petition the National Telecommunications and Information Administration (NTIA) filed at the direction of President Donald Trump. Pai remarked “I do not intend to move forward with the notice of proposed rule-making at the FCC” because “in part, because given the results of the election, there’s simply not sufficient time to complete the administrative steps necessary in order to resolve the rule-making.” Pai cautioned Congress and the Biden Administration “to study and deliberate on [reforming Section 230] very seriously,” especially “the immunity provision.”  
    • In October, Pai had announced the FCC would proceed with a notice and comment rulemaking based on the NTIA’s petition asking the agency to start a rulemaking to clarify alleged ambiguities in 47 USC 230 regarding the limits of the liability shield for the content others post online versus the liability protection for “good faith” moderation by the platform itself. The NTIA was acting per direction in an executive order allegedly aiming to correct online censorship. Executive Order 13925, “Preventing Online Censorship” was issued in late May after Twitter factchecked two of President Donald Trump’s Tweets regarding false claims made about mail voting in California in response to the COVID-19 pandemic.
  • A House committee released its most recent assessment of federal cybersecurity and information technology (IT) assessment. The House Oversight Committee’s Government Operations Subcommittee released its 11th biannual scorecard under the “Federal Information Technology Acquisition Reform Act (FITARA). The subcommittee stressed this “marks the first time in the Scorecard’s history that all 24 agencies included in the law have received A’s in a single category” and noted it is “the first time that a category will be retired.” Even though this assessment is labeled the FITARA Scorecard, it is actually a compilation of different metrics borne of other pieces of legislation and executive branch programs.
    • Additionally, 19 of the 24 agencies reviewed received A’s on the Data Center Optimization Initiative (DCOI)
    • However, four agencies received F’s on Agency Chief Information Officer (CIO) authority enhancements, measures aiming to fulfill one of the main purposes of FITARA: empowering agency CIOs as a means of controlling and managing better IT acquisition and usage. It has been an ongoing struggle to get agency compliance with the letter and spirit of federal law and directives to do just this.
    • Five agencies got F’s and two agencies got D’s for failing to hit the schedule for transitioning off of the “the expiring Networx, Washington Interagency Telecommunications System (WITS) 3, and Regional Local Service Agreement (LSA) contracts” to the General Services Administration’s $50 billion Enterprise Infrastructure Solutions (EIS). The GSA explained this program in a recent letter:
      • After March 31, 2020, GSA will disconnect agencies, in phases, to meet the September 30, 2022 milestone for 100% completion of transition. The first phase will include agencies that have been “non-responsive” to transition outreach from GSA. Future phases will be based on each agency’s status at that time and the individual circumstances impacting that agency’s transition progress, such as protests or pending contract modifications. The Agency Transition Sponsor will receive a notification before any services are disconnected, and there will be an opportunity for appeal.
  • A bipartisan quartet of United States Senators urged the Trump Administration in a letter to omit language in a trade agreement with the United Kingdom (UK) that mirrors the liability protection in 47 U.S.C. 230 (Section 230). Senators Rob Portman (R-OH), Mark R. Warner (D-VA), Richard Blumenthal (D-CT), and Charles E. Grassley (R-IA) argued to U.S. Trade Representative Ambassador Robert Lighthizer that a “safe harbor” like the one provided to technology companies for hosting or moderating third party content is outdated, not needed in a free trade agreement, contrary to the will of both the Congress and UK Parliament, and likely to be changed legislatively in the near future. However, left unsaid in the letter, is the fact that Democrats and Republicans generally do not agree on how precisely to change Section 230. There may be consensus that change is needed, but what that change looks like is still a matter much in dispute.
    • Stakeholders in Congress were upset that the Trump Administration included language modeled on Section 230 in the United States-Mexico-Canada Agreement (USMCA), the modification of the North American Free Trade Agreement (NAFTA). For example, House Energy and Commerce Committee Chair Frank Pallone Jr (D-NJ) and then Ranking Member Greg Walden (R-OR) wrote Lighthizer, calling it “inappropriate for the United States to export language mirroring Section 230 while such serious policy discussions are ongoing” in Congress.
  • The Trump White House issued a new United States (U.S.) government strategy for advanced computing to replace the 2019 strategy. The “PIONEERING THE FUTURE ADVANCED COMPUTING ECOSYSTEM: A STRATEGIC PLAN” “envisions a future advanced computing ecosystem that provides the foundation for continuing American leadership in science and engineering, economic competitiveness, and national security.” The Administration asserted:
    • It develops a whole-of-nation approach based on input from government, academia, nonprofits, and industry sectors, and builds on the objectives and recommendations of the 2019 National Strategic Computing Initiative Update: Pioneering the Future of Computing. This strategic plan also identifies agency roles and responsibilities and describes essential operational and coordination structures necessary to support and implement its objectives. The plan outlines the following strategic objectives:
      • Utilize the future advanced computing ecosystem as a strategic resource spanning government, academia, nonprofits, and industry.
      • Establish an innovative, trusted, verified, usable, and sustainable software and data ecosystem.
      • Support foundational, applied, and translational research and development to drive the future of advanced computing and its applications.
      • Expand the diverse, capable, and flexible workforce that is critically needed to build and sustain the advanced computing ecosystem.
  • A federal court threw out a significant portion of a suit Apple brought against a security company, Corellium, that offers technology allowing security researchers to virtualize the iOS in order to undertake research. The United States District Court for the Southern District of Florida summarized the case:
    • On August 15, 2019, Apple filed this lawsuit alleging that Corellium infringed Apple’s copyrights in iOS and circumvented its security measures in violation of the federal Digital Millennium Copyright Act (“DMCA”). Corellium denies that it has violated the DMCA or Apple’s copyrights. Corellium further argues that even if it used Apple’s copyrighted work, such use constitutes “fair use” and, therefore, is legally permissible.
    • The court found “that Corellium’s use of iOS constitutes fair use” but did not for the DMCA claim, thus allowing Apple to proceed with that portion of the suit.
  • The Trump Administration issued a plan on how cloud computing could be marshalled to help federally funded artificial intelligence (AI) research and development (R&D). A select committee made four key recommendations that “should accelerate the use of cloud resources for AI R&D: 1)launch and support pilot projects to identify and explore the advantages and challenges associated with the use of commercial clouds in conducting federally funded AI research; (2) improve education and training opportunities to help researchers better leverage cloud resources for AI R&D; (3) catalog best practices in identity management and single-sign-on strategies to enable more effective use of the variety of commercial cloud resources for AI R&D; and (4) establish and publish best practices for the seamless use of different cloud platforms for AI R&D. Each recommendation, if adopted, should accelerate the use of cloud resources for AI R&D.”

Coming Events

  • On 13 January, the Federal Communications Commission (FCC) will hold its monthly open meeting, and the agency has placed the following items on its tentative agenda “Bureau, Office, and Task Force leaders will summarize the work their teams have done over the last four years in a series of presentations:
    • Panel One. The Commission will hear presentations from the Wireless Telecommunications Bureau, International Bureau, Office of Engineering and Technology, and Office of Economics and Analytics.
    • Panel Two. The Commission will hear presentations from the Wireline Competition Bureau and the Rural Broadband Auctions Task Force.
    • Panel Three. The Commission will hear presentations from the Media Bureau and the Incentive Auction Task Force.
    • Panel Four. The Commission will hear presentations from the Consumer and Governmental Affairs Bureau, Enforcement Bureau, and Public Safety and Homeland Security Bureau.
    • Panel Five. The Commission will hear presentations from the Office of Communications Business Opportunities, Office of Managing Director, and Office of General Counsel.
  • On 27 July, the Federal Trade Commission (FTC) will hold PrivacyCon 2021.

© Michael Kans, Michael Kans Blog and michaelkans.blog, 2019-2021. Unauthorized use and/or duplication of this material without express and written permission from this site’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Michael Kans, Michael Kans Blog, and michaelkans.blog with appropriate and specific direction to the original content.

Image by Gerd Altmann from Pixabay

Further Reading, Other Developments, and Coming Events (16 November)

Further Reading

  • Trump’s refusal to begin the transition could damage cybersecurity” By Joseph Marks — The Washington Post. Former executive branch officials, some of whom served at the Department of Homeland Security (DHS), are warning that the Trump Administration’s refusal to start the transition to the Biden Administration may harm the United States’ (U.S.) ability to manage cyber risks if it stretches on too long.
  • Biden will get tougher on Russia and boost election security. Here’s what to expect.” By Joseph Marks — The Washington Post. Expect a Biden Administration to restore cybersecurity policy to the prominence it had in the Obama Administration with renewed diplomatic efforts to foster international consensus against nations like the Russian Federation or People’s Republic of China. A Biden Presidency will likely continue to pursue the Trump Administration’s larger objectives on the People’s Republic of China but without the capriciousness of the current President introducing an element of uncertainty. And, election security and funding will naturally be a focus, too.
  • Taking Back Our Privacy” By Anna Wiener — The New Yorker. This fascinating profile of Moxie Marlinspike (yes, that’s really his name), the prime mover behind end-to-end encryption in WhatsApp and his application, Signal, (hands down the best messaging app, in my opinion), is worth your time.
  • Biden’s Transition Team Is Stuffed With Amazon, Uber, Lyft, and Airbnb Personnel” By Edward Ongweso Jr — Vice’s Motherboard. This piece casts a critical eye on a number of members of the Biden-Harris transition team that have been instrumental in policy changes desired by their employers seemingly at odds with the President-elect’s policies. It remains to be seen how such personnel may affect policies for the new Administration.
  • Officials say firing DHS cyber chief could make U.S. less safe as election process continues” By Joseph Marks — The Washington Post. The head of the Department of Homeland Security’s Cybersecurity Infrastructure and Security Agency (CISA) may well be among those purged by the Trump Administration regardless of the costs to national security. CISA Director Christopher Krebs has deftly navigated some of the most fraught, partisan territory in the Trump Administration in leading efforts on election security, but his webpage, Rumor Control, may have been too much for the White House. Consequently, Krebs is saying he expects to be fired like CISA Assistant Director Bryan Ware was this past week.

Other Developments

  • The Democratic leadership on a key committee wrote the chairs of both the Federal Trade Commission (FTC) and the Federal Communications Commission (FCC), “demanding that the two commissions stop work on all partisan or controversial items currently under consideration in light of the results of last week’s presidential election” per the press release. House Energy and Commerce Committee Chair Frank Pallone Jr. (D-NJ), Consumer Protection and Commerce Subcommittee Chair Jan Schakowsky (D-IL), and Communications and Technology Subcommittee Chair Mike Doyle (D-PA) argued that FTC Chair Joseph Simons and FCC Chair Ajit Pai should “only pursue consensus and administrative matters that are non-partisan for the remainder of your tenure.” The agencies are, of course, free to dismiss the letters and the request and may well do so, especially in the case of the FCC and its rulemaking on 47 U.S.C. 230. Additionally, as rumored, the FTC may soon file an antitrust case against Facebook for its dominance of the social messaging market when Democrats on the FTC and elsewhere might prefer a broader case.
  • The Office of Personnel Management’s (OPM) Office of the Inspector General (OIG) released a pair of audits on the agency’s information security practices and procedures and found continued weaknesses in the agency’s systems. The OPM was breached by People’s Republic of China (PRC) hackers during the Obama Administration and massive amounts of information about government employees was exfiltrated. Since that time, the OPM has struggled to mend its information security and systems.
    • In “Audit of the Information Technology Security Controls of the U.S. Office of Personnel Management’s Agency Common Controls,” the OIG found explained that its “audit of the agency common controls listed in the Common Security Control Collection (CSCC) determined that:
      • Documentation assigning roles and responsibilities for the governance of the CSCC does not exist.
      • Inconsistencies in the risk assessment and reporting of deficient controls were identified in the most recent assessment results documentation of the CSCC.
      • Weaknesses identified in an assessment of the CSCC were not tracked through a plan of actions and milestones.
      • Weaknesses identified in an assessment of the CSCC were not communicated to the Information System Security Officers, System Owners or Authorizing Officials of the systems that inherit the controls.
      • We tested 56 of the 94 controls in the CSCC. Of the 56 controls tested, 29 were either partially satisfied or not satisfied. Satisfied controls are fully implemented controls according to the National Institute of Standards and Technology.”
    • And, in the annual Federal Information Security Modernization Act (FISMA) audit, the OIG found middling progress. Specifically, with respect to the FISMA IG Reporting Metrics, the OIG found:
      • Risk Management – OPM has defined an enterprise-wide risk management strategy through its risk management council. OPM is working to implement a comprehensive inventory management process for its system interconnections, hardware assets, and software.
      • Configuration Management – OPM continues to develop baseline configurations and approve standard configuration settings for its information systems. The agency is also working to establish routine audit processes to ensure that its systems maintain compliance with established configurations.
      • Identity, Credential, and Access Management (ICAM) – OPM is continuing to develop its agency ICAM strategy, and acknowledges a need to implement an ICAM program. However, OPM still does not have sufficient processes in place to manage contractors in its environment.
      • Data Protection and Privacy – OPM has implemented some controls related to data protection and privacy. However, there are still resource constraints within OPM’s Office of Privacy and Information Management that limit its effectiveness.
      • Security Training – OPM has implemented a security training strategy and program, and has performed a workforce assessment, but is still working to address gaps identified in its security training needs.
      • Information Security Continuous Monitoring – OPM has established many of the policies and procedures surrounding continuous monitoring, but the agency has not completed the implementation and enforcement of the policies. OPM also continues to struggle to conduct security controls assessments on all of its information systems.
      • Incident Response – OPM has implemented many of the required controls for incident response. Based upon our audit work, OPM has successfully implemented all of the FISMA metrics at the level of “consistently implemented” or higher.
      • Contingency Planning – OPM has not implemented several of the FISMA requirements related to contingency planning, and continues to struggle to maintain its contingency plans as well as conducting contingency plan tests on a routine basis.
  • The Australian Competition and Consumer Commission (ACCC) announced “amendments to the Consumer Data Right Rules…[that] permit the use of accredited intermediaries to collect data, through an expansion of the rules relating to outsourced service providers” per the press release. The ACCC stated “The amendments expand the Consumer Data Right system by allowing for accredited businesses to rely on other accredited businesses to collect Consumer Data Right data on their behalf, so they can provide goods and services to consumers.” The ACCC stated “[t]he Competition and Consumer (Consumer Data Right) Amendment Rules (No. 2) 2020 (Accredited Intermediary Rules) commenced on 2 October 2020 and are available on the Federal Register of Legislation.”
  • Singapore’s central bank called on financial institutions to ramp up cybersecurity because of increased threats during the COVID-19 pandemic. The Monetary Authority of Singapore (MAS)’s Cyber Security Advisory Panel (CSAP) held “its fourth annual meeting with MAS management…[and] shared its insights on cyber risks in the new operating environment and made several recommendations:”
    • Reviewing risk profiles and adequacy of risk mitigating measures. The Panel discussed the risks and vulnerabilities arising from the rapid adoption of remote access technologies and work processes that could affect FIs’ cyber risk profiles. The meeting highlighted the need for FIs to assess if their existing risk profiles have changed and remain acceptable. This is to ensure that in the long run appropriate controls are implemented to mitigate any new risks.  
    • Maintaining oversight of third-party vendors and their controls. With the increased reliance on third-party vendors, the Panel emphasised the need for FIs to step up their oversight of these counterparts and to monitor and secure remote access by third-parties to FIs’ systems. This is even more important during the COVID-19 pandemic where remote working has become pervasive.
    • Strengthening governance over the use of open-source software (OSS). Vulnerabilities in OSS are typically targeted and exploited by threat actors. The Panel recommended that FIs establish policies and procedures on the use of OSS and to ensure these codes are robustly reviewed and tested before they are deployed in the FIs’ IT environment.
  • Washington State Attorney General Bob Ferguson issued his fifth annual Data Breach Report “showed that the number of Washingtonians affected by breaches nearly doubled in the last year and ransomware attacks tripled” according to his press release. Ferguson asserted:
    • The total number of Washingtonians affected by a data breach increased significantly, from 351,000 in 2019 to 651,000 in 2020. Overall, there were fewer breaches reported to the Attorney General’s Office in 2020, decreasing from 60 reported breaches last year to 51 this year.
    • Ferguson made the following recommendations:
      • 1. Bring RCW 19.255.005 and RCW 42.56.590 into alignment by making sure that private entities also have to provide notice to consumers for breaches of a consumer’s name and the last-four digits of their Social Security number.
      • SB 6187, which was signed by Governor Inslee on March 18, 2020, and went into effect on June 11, 2020 modified the definition of personal information for breaches that occur at local and state agencies. Specifically, the bill modified the definition of personal information in RCW 42.56.590 to include the last four digits of a SSN in combination with a consumer’s name as a stand alone element that will trigger the requirement for consumer notice. This change should be extended to RCW 19.255.005 as well, to bring both laws into alignment, and provide consumers with the most robust protections possible, regardless of the type of entity that was breached.
      • 2. Expand the definition of “personal information” in RCW 19.255.005 and RCW 42.56.590 to include Individual Tax Identification numbers (ITINs).
      • ITINs are assigned by the IRS to foreign-born individuals who are unable to acquire a Social Security number for the purposes of processing various tax related documents. In other words, they are a unique identifier equivalent in sensitivity to a Social Security number. At present, ten states include ITINs in their definition of “personal information.” In 2018, Washington State was home to just over 1.1 million foreign born individuals, representing approximately 15% of the state’s population.
      • 3. Establish a legal requirement for persons or businesses that store personal information to maintain a risk-based information security program, and to ensure that information is not retained for a period longer than is reasonably required.
      • As this report discussed last year, it is imperative that entities who handle the private information of Washingtonians take steps necessary to keep it safe, and be prepared to act if they cannot. Such precautions are beneficial for both consumers and the organizations collecting their data. In 2019, Ponemon Report indicated that 48% of the companies surveyed lacked any form of security automation – security technologies used to detect breaches more efficiently than humans can.22 In 2020, that number dropped by only 7%.23
      • In 2019, the average cost of a data breach for companies without automation was nearly twice as expensive as for those who implemented security automation. That cost has only grown since, with data breaches in 2020 costing companies without security automation nearly triple that of business who have automation. Similarly, the formation of a dedicated Incident Response Team and testing of an Incident Response Plan reduced the average total cost of breaches in 2020 by more than $2 million.
      • Requiring data collectors to maintain an appropriately sized security program and incident response team and to dispose of consumer information that is no longer needed is a critical next step in mitigating the size and cost of breaches in our state.
  • Four former Secretaries of Homeland Security and two acting Secretaries wrote the leadership of the Congress regarding “the need to consolidate and strengthen Congressional oversight of the Department of Homeland Security (DHS) in order to make possible the fundamental changes that DHS urgently needs to protect the American people from the threats we face in 2021.” They noted “more than 90 different committees or subcommittees today have jurisdiction over DHS—far more than any other cabinet department.” They asserted:
    • DHS urgently needs to make major reforms, improvements, and enhancements to ensure the Department can protect the nation in the way Congress envisioned nearly two decades ago. DHS’s leadership, whether Democratic or Republican, needs to work with a single authorizing committee with broad subject matter authority to enact the changes and authorize the programs that DHS needs to address the threats of 2021.
  • Privacy International (PI) and 13 other groups from the European Union (EU) and Africa wrote the European Commission (EC), arguing the EU’s policies are supporting “the funding and development of projects and initiatives which threaten the right to privacy and other fundamental rights, such as freedom of expression and freedom of assembly.” These groups contended:
    • that by sponsoring such activities, the EU drives the adoption and use of surveillance technologies that, if abused by local actors, can potentially violate the fundamental rights of people residing in those countries. In the absence of rule of law and human rights safeguards enshrined in law, which seek to limit the state’s powers and protect people’s rights, these technologies can be exploited by authorities and other actors with access and result in onerous implications not just for the rights of privacy and data protection but also for other rights, such as freedom of expression and freedom of assembly.
    • In their press release, these groups stated the letter “comes following the public release of hundreds of documents obtained by PI after a year of negotiating with EU bodies under access to documents laws, which show:
      • How police and security agencies in Africa and the Balkans are trained with the EU’s support in spying on internet and social media users and using controversial surveillance techniques and tools; Read PI’s report here.
      • How EU bodies are training and equipping border and migration authorities in non-member countries with surveillance tools, including wiretapping systems and other phone surveillance tools, in a bid to ‘outsource’ the EU’s border controls; Read PI’s report here.
      • How Civipol, a well-connected French security company, is developing mass biometric systems with EU aid funds in Western Africa in order to stop migration and facilitate deportations without adequate risk assessments. Read PI’s report here.
    • They stated “we call on the European Commission, in coordination with the European Parliament and EU member states to:
      • Ensure no support is provided for surveillance or identity systems across external assistance funds and instruments to third countries that lack a clear and effective legal framework governing the use of the surveillance equipment or techniques.
      • Only provide support for surveillance or identity systems after an adequate risk assessment and due diligence are carried out.
      • Provide Parliament greater capabilities of scrutiny and ensuring accountability over funds.
      • All future projects aimed at addressing “the root causes of instability, forced displacement, and irregular migration” should be mainstreamed into the NDICI. In turn, discontinue the EUTF for Africa when the current fund comes to its end in 2020.
      • Ensure that EC Directorate-General for International Cooperation and Development (DEVCO), the EU body in charge of development aid, establishes a new Fund aimed at improving governance and legal frameworks in non-EU countries to promote the right to privacy and data protection. Priorities of the Fund should include:
        • Revising existing privacy and data protection legal frameworks, or where there is none developing new ones, that regulate surveillance by police and intelligence agencies, aimed at ensuring they are robust, effectively implemented, and provide adequate redress for individuals;
        • Strengthening laws or introducing new ones that set out clear guidelines within which the government authorities may conduct surveillance activities;
        • Focusing on promotion and strengthening of democratisation and human rights protections;
        • Strengthening the independence of key monitoring institutions, such as the judiciary, to ensure compliance with human rights standards.

Coming Events

  • On 17 November, the Senate Judiciary Committee will hold a hearing with Facebook CEO Mark Zuckerberg and Twitter CEO Jack Dorsey on Section 230 and how their platforms chose to restrict The New York Post article on Hunter Biden.
  • The Senate Homeland Security and Governmental Affairs Committee’s Regulatory Affairs and Federal Management Subcommittee will hold a hearing on how to modernize telework in light of what was learned during the COVID-19 pandemic on 18 November.
  • On 18 November, the Federal Communications Commission (FCC) will hold an open meeting and has released a tentative agenda:
    • Modernizing the 5.9 GHz Band. The Commission will consider a First Report and Order, Further Notice of Proposed Rulemaking, and Order of Proposed Modification that would adopt rules to repurpose 45 megahertz of spectrum in the 5.850-5.895 GHz band for unlicensed operations, retain 30 megahertz of spectrum in the 5.895-5.925 GHz band for the Intelligent Transportation Systems (ITS) service, and require the transition of the ITS radio service standard from Dedicated Short-Range Communications technology to Cellular Vehicle-to-Everything technology. (ET Docket No. 19-138)
    • Further Streamlining of Satellite Regulations. The Commission will consider a Report and Order that would streamline its satellite licensing rules by creating an optional framework for authorizing space stations and blanket-licensed earth stations through a unified license. (IB Docket No. 18-314)
    • Facilitating Next Generation Fixed-Satellite Services in the 17 GHz Band. The Commission will consider a Notice of Proposed Rulemaking that would propose to add a new allocation in the 17.3-17.8 GHz band for Fixed-Satellite Service space-to-Earth downlinks and to adopt associated technical rules. (IB Docket No. 20-330)
    • Expanding the Contribution Base for Accessible Communications Services. The Commission will consider a Notice of Proposed Rulemaking that would propose expansion of the Telecommunications Relay Services (TRS) Fund contribution base for supporting Video Relay Service (VRS) and Internet Protocol Relay Service (IP Relay) to include intrastate telecommunications revenue, as a way of strengthening the funding base for these forms of TRS and making it more equitable without increasing the size of the Fund itself. (CG Docket Nos. 03-123, 10-51, 12-38)
    • Revising Rules for Resolution of Program Carriage Complaints. The Commission will consider a Report and Order that would modify the Commission’s rules governing the resolution of program carriage disputes between video programming vendors and multichannel video programming distributors. (MB Docket Nos. 20-70, 17-105, 11-131)
    • Enforcement Bureau Action. The Commission will consider an enforcement action.

© Michael Kans, Michael Kans Blog and michaelkans.blog, 2019-2020. Unauthorized use and/or duplication of this material without express and written permission from this site’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Michael Kans, Michael Kans Blog, and michaelkans.blog with appropriate and specific direction to the original content.

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Further Reading, Other Developments, and Coming Events (31 August)

Today’s Further Reading, Other Developments, and Coming Events.

Coming Events

  • On 10 September, the General Services Administration (GSA) will have a webinar to discuss implementation of Section 889 of the “John S. McCain National Defense Authorization Act (NDAA) for FY 2019” (P.L. 115-232) that bars the federal government and its contractors from buying the equipment and services from Huawei, ZTE, and other companies from the People’s Republic of China.
  • The Federal Communications Commission (FCC) will hold a forum on 5G Open Radio Access Networks on 14 September. The FCC asserted
    • Chairman [Ajit] Pai will host experts at the forefront of the development and deployment of open, interoperable, standards-based, virtualized radio access networks to discuss this innovative new approach to 5G network architecture. Open Radio Access Networks offer an alternative to traditional cellular network architecture and could enable a diversity in suppliers, better network security, and lower costs.
  • The Senate Judiciary Committee’s Antitrust, Competition Policy & Consumer Rights Subcommittee will hold a hearing on 15 September titled “Stacking the Tech: Has Google Harmed Competition in Online Advertising?.” In their press release, Chair Mike Lee (R-UT) and Ranking Member Amy Klobuchar (D-MN) asserted:
    • Google is the dominant player in online advertising, a business that accounts for around 85% of its revenues and which allows it to monetize the data it collects through the products it offers for free. Recent consumer complaints and investigations by law enforcement have raised questions about whether Google has acquired or maintained its market power in online advertising in violation of the antitrust laws. News reports indicate this may also be the centerpiece of a forthcoming antitrust lawsuit from the U.S. Department of Justice. This hearing will examine these allegations and provide a forum to assess the most important antitrust investigation of the 21st century.
  • The United States’ Department of Homeland Security’s (DHS) Cybersecurity and Infrastructure Security Agency (CISA) announced that its third annual National Cybersecurity Summit “will be held virtually as a series of webinars every Wednesday for four weeks beginning September 16 and ending October 7:”
    • September 16: Key Cyber Insights
    • September 23: Leading the Digital Transformation
    • September 30: Diversity in Cybersecurity
    • October 7: Defending our Democracy
    • One can register for the event here.
  • On 22 September, the Federal Trade Commission (FTC) will hold a public workshop “to examine the potential benefits and challenges to consumers and competition raised by data portability.”
  • The Senate Judiciary Committee’s Antitrust, Competition Policy & Consumer Rights Subcommittee will hold a hearing on 30 September titled ““Oversight of the Enforcement of the Antitrust Laws” with Federal Trade Commission Chair Joseph Simons and United States Department of Justice Antitrust Division Assistant Attorney General Makan Delhrahim.
  • The Federal Communications Commission (FCC) will hold an open meeting on 30 September, but an agenda is not available at this time.

Other Developments

  • A group of Democratic Senators wrote the Federal Communications Commission (FCC) “to express our profound frustration that the [agency] has failed to take forceful action to keep households connected during the COVID-19 pandemic.” They asserted that “[a]s millions of American families face unprecedented financial pressures and educational challenges, we urge the FCC to reverse proposed changes to the Lifeline program, take immediate steps to open its assistance to more households, and ensure that its services meet the pressing needs of families during this crisis.”
    • They claimed
      • Since the first weeks of [FCC Chair Ajit Pai’s tenure], the FCC has sought to block new broadband providers’ participation in the Lifeline program, curtail benefits in tribal areas, exclude existing carriers, rollback reforms for registering new carriers, make it harder for new applicants  to subscribe, prevent carriers from offering free in-person distribution of phones, reduce incentives to enroll subscribers, and add more barriers for participating carriers and subscriber. These proposals have been so extreme that they would lead to cutting off carriers serving almost 70% of Lifeline subscribers.
    • They urged Pai “to immediately take the following steps:
      • 1.) Take emergency measures to provide additional financial support to Lifeline providers during the pandemic to temporarily support unlimited mobile data and voice minutes, and notify Congress if additional funding is needed for such changes.
      • 2.) Extend all current FCC waivers on Lifeline usage and subscriber documentation requirements for at least a full year, until August 2021or when we have recovered from the pandemic.
      • 3.) Close the currently outstanding Lifeline proposed rulemakings that would create new obstacles for eligible households and add unwarranted burden on carriers.
      • 4.)Pause the scheduled changes to Lifeline program’s minimum service standards until the Commission studies such impacts on the market in its upcoming 2021 State of Lifeline Marketplace Report, to avoid disruptions to customers’ services.
      • 5.) Restore the monthly subsidy to $9.25 for plans offering voice services for subscribers who value voice over data-heavy plans and pause the planned decrease in contributions for voice support.
      • 6.) Work with states to increase the automated verification of state databases with the National Verifier program by the end of this year.
  • New Zealand’s National Cyber Security Centre (NCSC) released a “General Security Advisory: ongoing campaign of Denial of Service (DoS) attacks affecting New Zealand entities” after four days of DoS attacks against New Zealand’s stock market coming from somewhere offshore. The NCSC recommended best practices the Australian Cyber Security Centre (ACSC) had published. The NCSC stated
    • [It] is aware of an ongoing campaign of DoS attacks affecting New Zealand entities.
    • The campaign has included the targeting of a number of global entities, predominantly in the financial sector. 
    • The NCSC strongly encourages all organisations in this sector to consider the risk to their organisation of DoS and ensure appropriate mitigations are in place.
  • Senator Mark Warner (D-VA) letters to DellAppleHPSamsungGoogleMicrosoftAcer America, and ASUS USA asking the “companies to do what they can to help bridge the “homework gap” – the lack of reliable computer or internet access that prevents school-aged children from being able to do school work from home.” Warner’s letter is in response to the nationwide shortage of lost laptops and tablets facing families as many children will be starting school online this fall. Warner stated:
    • There are a range of actions your company can take, including educational product discounts, the provision of complimentary or donated computers (including for home lending programs many educational institutions operate), and the provision of refurbished or returned products in good working condition for school districts and higher education institutions to distribute to educators and students. While I understand the strains placed on the global supply chain, your prioritization of these matters would greatly assist struggling families at this challenging time.
  • The United States Department of Defense (DOD) updated its list of ““Communist Chinese military companies” operating directly or indirectly in the United States in accordance with the statutory requirement of Section 1237 of the National Defense Authorization Act for Fiscal Year 1999, as amended.” The eleven companies from the People’s Republic of China (PRC) were added to the existing list sent “to Congress in June 2020,” some 20 years after Congress tasked the DOD with this responsibility. This action is most likely in response to a letter sent last year to fulfill this responsibility. Notably, any company on the list could be sanctioned by the President under the same authorities recently used against TikTok and WeChat.
    • In a September 2019 letter to Secretary of Defense Mark Esper, Senate Minority Leader Chuck Schumer (D-NY) and Senator Tom Cotton (R-AR) were joined by Representatives Ruben Gallego (D-AZ) and Mike Gallagher (R-WI) in asking whether the DOD has been updating a list of “those persons operating directly or indirectly in the United States or any of its territories and possessions that are Communist Chinese military companies” as directed by Section 1237 of the FY 1999 NDAA. They noted that China’s Communist Party has adopted a Military-Civilian Fusion strategy “to achieve its national objectives,” including the acquisition of U.S. technology through any means such as espionage, forced technology transfers, and the purchase of or investment in U.S. technology forms. Schumer, Cotton, Gallego, and Gallagher urged the Trump Administration “reexamine all statutory authorities at its disposal to confront the CCP’s strategy of Military-Civilian Fusion, including powers that have laid dormant for years.”
    • Unstated in this letter, however, is that the first part of Section 1237 grants the President authority to “exercise International Emergency Economic Powers Act (IEEPA) authorities (other than authorities relating to importation) without regard to section 202 of the IEEPA (50 U.S.C. 1701) in the case of any commercial activity in the United States by a person that is on the list.” Of IEEPA grants the President sweeping powers to prohibit transactions and block property and property interests for nations and other groups subject to an IEEPA national emergency declaration. Consequently, those companies identified by the DOD on a list per Section 1237 could be blocked and prohibited from doing business with U.S. entities and others and those that do business with such Chinese companies could be subject to enforcement actions by the U.S. government (e.g. the U.S.’s actions against ZTE for doing business with Iran in violation of an IEEPA national emergency).
    • The statute defines a “Communist Chinese military company” as “any person identified in the Defense Intelligence Agency publication numbered VP-1920-271-90, dated September 1990, or PC-1921-57-95, dated October 1995, and any update of those publications for the purposes of this section; and any other person that is owned or controlled by the People’s Liberation Army; and is engaged in providing commercial services, manufacturing, producing, or exporting.” Considering that the terms “owned” and “controlled” are not spelled out in this section, the executive branch may have very wide latitude in deeming a non-Chinese company as owned or controlled and therefore subject to the President’s use of IEEPA powers. Moreover, since the President already has the authority to declare an emergency and then use IEEPA powers, this language would seem to allow the President to bypass any such declaration and immediately use such powers, except those regarding importation, against any Chinese entities identified on this list by the Pentagon.
  • District of Columbia Attorney General Karl Racine (D) filed suit against Instacart alleging the company “violated the District’s Consumer Protection Procedures Act and tax law by: 
    • Charging District consumers millions of dollars in deceptive service fees: Prior to 2016, Instacart’s checkout screen contained an option to tip workers, set as a default 10 percent of the consumer’s subtotal for groceries that users could adjust. In 2016, Instacart swapped the tip option for a service fee, which was also set to a default 10 percent and could be adjusted, and displayed it where the tip option used to be. Consumers paid the service fee believing they were tipping workers. In reality, the service fee was a second charge—on top of a delivery fee—imposed by Instacart to cover delivery costs and operating expenses. Additionally, Instacart failed to clearly disclose that service fees were optional and that consumers could choose not to pay them.
    • Misleading consumers about how service fees contributed to worker pay: When Instacart announced the new service fees, it told consumers that “100% of the variable service amount is used to pay all shoppers more consistently for each and every delivery, not just the last shopper to touch the order.” Instacart also stated that the company collected a service fee because “multiple shoppers may have been involved in a single order” and the “service fee is used to pay this entire set of shoppers.” In fact, the shoppers who fulfilled a consumer’s order were paid the same whether or not a consumer paid the service fee.
    • Failing to pay at hundreds of thousands of dollars in District sales tax: Under District law, Instacart is responsible for collecting sales tax on the delivery services it provides. The entire time Instacart has operated in the District, it has failed to collect sales tax on the service fees and delivery fees it charged users.
  • Two large United States (U.S.) technology companies are facing class actions in the Netherlands and the United Kingdom (UK) that argue the companies’ use of third party cookies in order to sell real time bidding advertising violated the European Union’s General Data Protection Regulation (GDPR) by not obtaining the consent of people before their personal information is collected and processed. The suit against Oracle and Salesforce is being brought by The Privacy Collective, a European non-profit, that could result in damages of more than €10 billion.
  • As part of its lawsuit against Google “for deceptive and unfair practices used to obtain users’ location data, which Google then exploits for its lucrative advertising business,” the Office of the Attorney General of Arizona released emails obtained during the course of discovery that may demonstrate the company’s knowledge that its interface and operating system were trying to frustrate a user’s desire to truly turn off location data.
  • The eHealth Initiative & Foundation (eHI) and the Center for Democracy and Technology (CDT) released A Draft Consumer Privacy Framework for Health Data, “a collaborative effort addressing gaps in legal protections for consumer health data outside of the Health Insurance Portability and Accountability Act’s (HIPAA) coverage.” Feedback is welcome until 25 September.
    • The organizations asserted
      • The standards’ emphasis is on transparency, accountability, and the limitation on health data collection, disclosure, and use. Importantly, the standards:
        • (1) move beyond outdated notice and consent models,
        • (2) cover all health information, and
        • (3) cover all entities that use, disclose or collect consumer health information, regardless of the size or business model of the covered entity.
      • This proposal is not designed to be a replacement for necessary comprehensive data privacy legislation. Given that Congressional action to pass such a law is likely some time away, this effort is designed to build consensus on best practices and to do what we can now, in the interim, to shore up protections for non-HIPAA covered health data.

Further Reading

  • Big Oil Faded. Will Big Tech?” By Shira Ovide – The New York Times. This piece suggests that the so-called Big Tech companies may someday wane as many energy companies like Exxon are currently doing. The interesting point is made that a company or field’s preeminence can rapidly disappear and it can seem dominant until it is not. And this frequently happens for reasons that do not seem apparent or related. Ironically, Exxon essentially got pushed out of the Dow Jones Industrial Average because Apple had to split its stock because of its surging valuation. Another tech company, Salesforce, will replace Exxon.
  • Apple wants to stop advertisers from following you around the web. Facebook has other ideas.” By Peter Kafka – Recode. Apple will extend a feature from Safari to its next iOS for iPhones where users will soon be asked whether they want to allow apps to track them across the web and other apps in order to deliver them targeted, personalized advertising. To no great surprise, it is being assumed many users will say no, diminishing a prime mode by which companies reap data and show people advertisements that are intimately tied to what they read and watch online. Consequently, advertisers will be less willing to spend dollars on more general ads and income will be depressed for the two major players in this market: Facebook and Google. Facebook has already declared it will not use Apple’s device identifier unique to every iPhone or Apple Watch, meaning users downloading the Facebook app will not get the choice of whether to say no to the companies tracking them. It is not clear how well this workaround will mitigate the projected loss in ad revenue for Facebook, but it does represent the latest chapter in the fight between the two companies. Facebook has lined up with Epic Games, maker of Fortnite, in its suit against Apple regarding App Store policies. It is very likely Apple sees this change to iOS 14 as a means of burnishing its reputation as being more concerned about its users privacy than competitors in Silicon Valley, which it can afford to be considering it does not earn most of its revenue the same way Facebook does, and curry favor in Washington and Brussels where it is facing antitrust scrutiny.
  • Want a Free Amazon Halo Wearable? Just Hand Over Your Data to This Major Insurance Company” By Emily Mullin – OneZero. Amazon has teamed with insurer John Hancock to offer a wearable health and fitness tracker that will be used to collect personal data on wearers that is designed to nudge them into better behaviors and better health. This is not the first such pairing, and it raises a host of policy issues, for healthier people would be poised to reap benefits not available to less healthy people. Some insurers are offering modest amounts of cash or gift cards for exercising regularly or other benefits that would not go to less healthy people. These sorts of programs are similar to employee health and wellness programs that were enshrined in the “Patient Protection and Affordable Care Act” that studies have suggested do not work very well. Additionally, companies like Amazon and John Hancock will be collecting and processing all sorts of very sensitive personal information, making them likely targets of hacking operations. Also, there are privacy implications, for these wearable devices will likely allow companies to know the most intimate details of wearers’ lives.
  • TikTok Deal Is Complicated by New Rules From China Over Tech Exports” By Paul Mozur, Raymond Zhong and David McCabe – The New York Times; “TikTok Is Said to Wrestle With Two Competing Offers” By Mike Isaac – The New York Times; “China’s new tech export restrictions further cloud US TikTok sale and raise the risk of protectionism” By Coco Feng, Tracy Qu and Amanda Lee– South China Morning Post; “China puts drones and laser tech on restricted export list after US tightens rules” By Sidney Leng – South China Morning Post; “TikTok Chief Executive Kevin Mayer Resigns” By Mike Isaac – The New York Times.In a surprise announcement from two agencies late last week, the People’s Republic of China changed its export control rules for the first time since 2008 to likely have leverage over TikTok’s sale to a United States (U.S.) entity. Ostensibly, the changes are “to regulate technology exports, promote scientific and technological progress and economic and technological cooperation, and maintain national economic security,” but the inclusion of “personalised information recommendation service technology based on data analysis” and “artificial intelligence interactive interfaces” likely point to ByteDance’s app, TikTok. In fact a researcher with the PRC Ministry of Commerce was quoted as asserting “[t]he time to publish the new update of the export control list has been expedited due to the TikTok sale.” Moreover, the PRC’s timeline for deciding on whether an export license is needed is the same as the Trump Administration’s second executive order directing ByteDance to divest TikTok. Incidentally, these changes are probably in response to tighten of U.S. export controls against the PRC, which could set off retaliatory moves. In any event, Beijing will now have to approve any sale of TikTok operations in the U.S. Also, Walmart has apparently joined forces with Microsoft in preparing a bid on TikTok in competition with Oracle which threw its proverbal hat into the ring last week. And, new TikTok CEO Kevin Mayer stepped down in a surprise move citing ByteDance’s changed circumstances.
  • Trump aides interviewing replacement for embattled FTC chair” By Leah Nylen, Betsy Woodruff Swan, John Hendel and Daniel Lippman – Politico. The Trump Administration may be trying to force out Federal Trade Commission Chair Joe Simons or merely interviewing replacements if he steps down next year should President Donald Trump still be in the White House next year. Given the reports that Simons has resisted pressure from the White House to comply with the executive order on Section 230 by investigating social media platforms, Simons has likely not won any new fans at 1600 Pennsylvania Avenue. Having said that, removing an FTC Commissioner is much harder than other top positions in the U.S. government, and the FTC is designed to be insulated from political pressure. However, Commissioners are politicians, too, and carefully gauge the direction the wind is blowing. That being said, Simons has also sent out signals he will step down next year and return to private practice, so the interviewing of possible successors may be entirely normal in an Administration that usually does not operate normally.

© Michael Kans, Michael Kans Blog and michaelkans.blog, 2019-2020. Unauthorized use and/or duplication of this material without express and written permission from this site’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Michael Kans, Michael Kans Blog, and michaelkans.blog with appropriate and specific direction to the original content.

Image by Gordon Johnson from Pixabay

Ninth Circuit Rules For FCC in 5G Case Brought by Cities

The agency’s plans to speed the rollout of 5G across the country is helped by a major win in appeals court.    

The Federal Communications Commission (FCC) has prevailed in a United States (U.S.) appeals court against a number of cities and companies that were seeking to block implementation of three 2018 orders to speed the implementation of 5G. The court ruled against the FCC only with respect to aesthetic regulations as it pertains to siting 5G cells. The agency trumpeted the ruling as allowing its plans for the development of 5G to move forward in a way that will help the United States win the race to 5G.

In August 2018, the FCC adopted its Third Report and Order and Declaratory Ruling on “Accelerating Wireless Broadband Deployment by Removing Barriers to Infrastructure Investment” that contain the three orders challenged in federal court: Small Cell Order, the Moratoria Order, and the One Touch Make-Ready Order. The FCC explained

The challenge for policymakers is that the deployment of these new [5G] networks will look different than the 3G and 4G deployments of the past. Over the last few years, providers have been increasingly looking to densify their networks with new small cell deployments that have antennas often no larger than a small backpack. From a regulatory perspective, these raise different issues than the construction of large, 200-foot towers that marked the 3G and 4G deployments of the past. Indeed, estimates predict that upwards of 80 percent of all new deployments will be small cells going forward. To support advanced 4G or 5G offerings, providers must build out small cells at a faster pace and at a far greater density of deployment than before.

FCC Chair Ajit Pai claimed in his press release:

Today’s decision is a massive victory for U.S. leadership in 5G, our nation’s economy, and American consumers. The court rightly affirmed the FCC’s efforts to ensure that infrastructure deployment critical to 5G—a key part of our 5G FAST Plan—is not impeded by exorbitant fees imposed by state and local governments, undue delays in local permitting, and unreasonable barriers to pole access. The wind is at our backs: With the FCC’s infrastructure policies now ratified by the court, along with pathbreaking spectrum auctions concluded, ongoing, and to come, America is well-positioned to extend its global lead in 5G and American consumers will benefit from the next generation of wireless technologies and services.

In relevant part of the opinion, the United States Court of Appeals for the Ninth Circuit summarized the dispute and its decision:

  • Before us are three FCC orders, issued in 2018, that deal with myriad issues arising from the application of a twentieth century statute to twenty-first century technology. The two orders we deal with first are known as the Small Cell Order and the Moratoria Order. Accelerating Wireless Broadband Deployment by Removing Barriers to Infrastructure Inv., 33 FCC Rcd. 9088 (2018) [hereinafter Small Cell Order]; Accelerating Wireless Broadband Deployment by Removing Barriers to Infrastructure Inv., 33 FCC Rcd. 7705, 7775–91 (2018) [hereinafter Moratoria Order]. The Orders spell out the limits on local governments’ authority to regulate telecommunications providers.
  • The FCC’s statutory authority for limiting local regulation on the deployment of this technology is contained in Sections 253(a) and 332(c)(7) of the Act and reflects congressional intent in 1996 to expand deployment of wireless services. Those provisions authorize the FCC to preempt any state and local requirements that “prohibit or have the effect of prohibiting” any entity from providing telecommunications services. See 47 U.S.C. § 253(a), (d).
  • Many of the issues before us concern whether challenged provisions constitute excessive federal regulation outside the scope of that congressional preemption directive, as understood by our Circuit’s leading case interpreting the statute, Sprint Telephony PCS, L.P. v. County of San Diego, 543 F.3d 571 (9th Cir. 2008) (en banc). We conclude that, given the deference owed to the agency in interpreting and enforcing this important legislation, the Small Cell and Moratoria Orders are, with the exception of one provision, in accord with the congressional directive in the Act, and not otherwise arbitrary, capricious, or contrary to law. See 5 U.S.C. § 706(2)(A).
  • The exception is the Small Cell Order provision dealing with the authority of local governments in the area of aesthetic regulations. We hold that to the extent that provision requires small cell facilities to be treated in the same manner as other types of communications services, the regulation is contrary to the congressional directive that allows different regulatory treatment among types of providers, so long as such treatment does not “unreasonably discriminate among providers of functionally equivalent services.” 47 U.S.C § 332(c)(7)(B)(i)(I). We also hold that the FCC’s requirement that all aesthetic criteria must be “objective” lacks a reasoned explanation.
  • The third FCC order before us is intended to prevent owners and operators of utility poles from discriminatorily denying or delaying 5G and broadband service providers access to the poles. Accelerating Wireless Broadband Deployment by Removing Barriers to Infrastructure Inv., 33 FCC Rcd. 7705, 7705–91 (2018). Known as the “One- Touch Make-Ready Order,” it was issued pursuant to the Pole Attachment Act originally passed in 1978 and expanded in the wake of the Telecommunications Act of 1996. 47 U.S.C. § 224. Section 224 of that Act allows utilities to deny access to pole attachers under some circumstances. Several utilities object to discrete aspects of the One-Touch Make-Ready Order. We uphold the Order, concluding that the FCC reasonably interpreted Section 224 as a matter of law, and the Order is not otherwise arbitrary or capricious.

© Michael Kans, Michael Kans Blog and michaelkans.blog, 2019-2020. Unauthorized use and/or duplication of this material without express and written permission from this site’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Michael Kans, Michael Kans Blog, and michaelkans.blog with appropriate and specific direction to the original content.

Image by ADMC from Pixabay

Further Reading, Other Developments, and Coming Events (23 July)

First things first, if you would like to receive my Technology Policy Update, email me. You can find some of these Updates from 2019 and 2020 here.

Here are Further Reading, Other Developments, and Coming Events.

Other Developments

  • New Zealand’s Privacy Commissioner has begun the process of implementing the new Privacy Act 2020 and has started asking for input on the codes of practice that will effectuate the rewrite of the nation’s privacy laws. The Commissioner laid out the following schedule:
    • Telecommunications Information Privacy Code and Civil Defence National Emergencies (Information Sharing) Code
      • Open: 29 July 2020 / Close: 26 August 2020
    • The Commissioner noted “[t]he new Privacy Act 2020 is set to come into force on 1 December…[and] makes several key reforms to New Zealand’s privacy law, including amendments to the information privacy principles.” The Commissioner added “[a]s a result, the six codes of practice made under the Privacy Act 1993 require replacement.”
  • Australia’s 2020 Cyber Security Strategy Industry Advisory Panel issued its report and recommendations “to provide strategic advice to support the development of Australia’s 2020 Cyber Security Strategy.” The body was convened by the Minister for Home Affairs. The panel “recommendations are structured around a framework of five key pillars:
    • Deterrence: The Government should establish clear consequences for those targeting businesses and Australians. A key priority is increasing transparency on Government investigative activity, more frequent attribution and consequences applied where appropriate, and strengthening the Australian Cyber Security Centre’s (ACSC’s) ability to disrupt cyber criminals by targeting the proceeds of cybercrime.
    • Prevention: Prevention is vital and should include initiatives to help businesses and Australians remain safer online. Industry should increase its cyber security capabilities and be increasingly responsible for ensuring their digital products and services are cyber safe and secure, protecting their customers from foreseeable cyber security harm. While Australians have access to trusted goods and services, they also need to be supported with advice on how to practice safe behaviours at home and work. A clear definition is required for what constitutes critical infrastructure and systems of national significance across the public and private sectors. This should be developed with consistent, principles-based regulatory requirements to implement reasonable protection against cyber threats for both the public and private sectors.
    • Detection: There is clear need for the development of a mechanism between industry and Government for real-time sharing of threat information, beginning with critical infrastructure operators. The Government should also empower industry to automatically detect and block a greater proportion of known cyber security threats in real-time including initiatives such as ‘cleaner pipes’.
    • Resilience: We know malicious cyber activity is hitting Australians hard. The tactics and techniques used by malicious cyber actors are evolving so quickly that individuals, businesses and critical infrastructure operators in Australia are not fully able to protect themselves and their assets against every cyber security threat. As a result, it is recommended that the Government should strengthen the incident response and victim support options already in place. This should include conducting cyber security exercises in partnership with the private sector. Speed is key when it comes to recovering from cyber incidents, it is therefore proposed that critical infrastructure operators should collaborate more closely to increase preparedness for major cyber incidents.
    • Investment: The Joint Cyber Security Centre (JCSC) program is a highly valuable asset to form a key delivery mechanism for the initiatives under the 2020 Cyber Security Strategy should be strengthened. This should include increased resources and the establishment of a national board in partnership with industry, states and territories with an integrated governance structure underpinned by a charter outlining scope and deliverables.
  •  Six of the world’s data protection authorities issued an open letter to the teleconferencing companies “to set out our concerns, and to clarify our expectations and the steps you should be taking as Video Teleconferencing (VTC) companies to mitigate the identified risks and ultimately ensure that our citizens’ personal information is safeguarded in line with public expectations and protected from any harm.” The DPAs stated that “[t]he principles in this open letter set out some of the key areas to focus on to ensure that your VTC offering is not only compliant with data protection and privacy law around the world, but also helps build the trust and confidence of your userbase.” They added that “[w]e welcome responses to this open letter from VTC companies, by 30 September 2020, to demonstrate how they are taking these principles into account in the design and delivery of their services. Responses will be shared amongst the joint signatories to this letter.” The letter was drafted and signed by:
    • The Privacy Commissioner of Canada
    • The United Kingdom Information Commissioner’s Office
    • The Office of the Australian Information Commissioner
    • The Gibraltar Regulatory Authority
    • The Office of the Privacy Commissioner for Personal Data, Hong Kong, China
    • The Federal Data Protection and Information Commissioner of Switzerland
  • The United States Office of the Comptroller of the Currency (OCC) “is reviewing its regulations on bank digital activities to ensure that its regulations continue to evolve with developments in the industry” and released an “advance notice of proposed rulemaking (ANPR) [that] solicits public input as part of this review” by 8 August 2020. The OCC explained:
    • Over the past two decades, technological advances have transformed the financial industry, including the channels through which products and services are delivered and the nature of the products and services themselves. Fewer than fifteen years ago, smart phones with slide-out keyboards and limited touchscreen capability were newsworthy.[1] Today, 49 percent of Americans bank on their phones,[2] and 85 percent of American millennials use mobile banking.[3]
    • The first person-to-person (P2P) platform for money transfer services was established in 1998.[4] Today, there are countless P2P payment options, and many Americans regularly use P2P to transfer funds.[5] In 2003, Congress authorized digital copies of checks to be made and electronically processed.[6] Today, remote deposit capture is the norm for many consumers.[7] The first cryptocurrency was created in 2009; there are now over 1,000 rival cryptocurrencies,[8] and approximately eight percent of Americans own cryptocurrency.[9] Today, artificial intelligence (AI) and machine learning, biometrics, cloud computing, big data and data analytics, and distributed ledger and blockchain technology are used commonly or are emerging in the banking sector. Even the language used to describe these innovations is evolving, with the term “digital” now commonly used to encompass electronic, mobile, and other online activities.
    • These technological developments have led to a wide range of new banking products and services delivered through innovative and more efficient channels in response to evolving customer preferences. Back-office banking operations have experienced significant changes as well. AI and machine learning play an increasing role, for example, in fraud identification, transaction monitoring, and loan underwriting and monitoring. And technology is fueling advances in payments. In addition, technological innovations are helping banks comply with the complex regulatory framework and enhance cybersecurity to more effectively protect bank and customer data and privacy. More and more banks, of all sizes and types, are entering into relationships with technology companies that enable banks and the technology companies to establish new delivery channels and business practices and develop new products to meet the needs of consumers, businesses, and communities. These relationships facilitate banks’ ability to reach new customers, better serve existing customers, and take advantage of cost efficiencies, which help them to remain competitive in a changing industry.
    • Along with the opportunities presented by these technological changes, there are new challenges and risks. Banks should adjust their business models and practices to a new financial marketplace and changing customer demands. Banks are in an environment where they compete with non-bank entities that offer products and services that historically have only been offered by banks, while ensuring that their activities are consistent with the authority provided by a banking charter and safe and sound banking practices. Banks also must comply with applicable laws and regulations, including those focused on consumer protection and Bank Secrecy Act/anti-money laundering (BSA/AML) compliance. And, importantly, advanced persistent threats require banks to pay constant and close attention to increasing cybersecurity risks.
    • Notwithstanding these challenges, the Federal banking system is well acquainted with and well positioned for change, which has been a hallmark of this system since its inception. The OCC’s support of responsible innovation throughout its history has helped facilitate the successful evolution of the industry. The OCC has long understood that the banking business is not frozen in time and agrees with the statement made over forty years ago by the U.S. Court of Appeals for the Ninth Circuit: “the powers of national banks must be construed so as to permit the use of new ways of conducting the very old business of banking.” [10] Accordingly, the OCC has sought to regulate banking in ways that allow for the responsible creation or adoption of technological advances and to establish a regulatory and supervisory framework that allows banking to evolve, while ensuring that safety and soundness and the fair treatment of customers is preserved.
  • A trio of House of Representatives Members have introduced “legislation to put American consumers in the driver’s seat by giving them clearer knowledge about the technology they are purchasing.” The “Informing Consumers about Smart Devices Act” (H.R.7583) was drafted and released by Representatives John Curtis (R-UT), Seth Moulton (D-MA), and Gus Bilirakis (R-FL) and according to their press release, it would:
    • The legislation is in response to reports about household devices listening to individuals’ conversations without their knowledge. While some manufacturers have taken steps to more clearly label their products with listening devices, this legislation would make this information more obvious to consumers without overly burdensome requirements on producers of these devices. 
    • Specifically, the bill requires the Federal Trade Commission (FTC) to work alongside industry leaders to establish guidelines for properly disclosing the potential for their products to contain audio or visual recording capabilities. To ensure this does not become an overly burdensome labeling requirement, the legislation provides manufacturers the option of requesting customized guidance from the FTC that fits within their existing marketing or branding practices in addition to permitting these disclosures pre or post-sale of their products.
  • House Oversight and Reform Committee Ranking Member James Comer (R-KY) sent Twitter CEO Jack Dorsey a letter regarding last week’s hack, asking for answers to his questions about the security practices of the platform. Government Operations Subcommittee Ranking Member Jody Hice (R-GA) and 18 other Republicans also wrote Dorsey demanding an explanation of “Twitter’s intent and use of tools labeled ‘SEARCH BLACKLIST’ and ‘TRENDS BLACKLIST’ shown in the leaked screenshots.”
  • The United States Court of Appeals for the District of Columbia has ruled against United States Agency for Global Media (USAGM) head Michael Pack and enjoined his efforts to fire the board of the Open Technology Fund (OTF). The court stated “it appears likely that the district court correctly concluded that 22 U.S.C. § 6209(d) does not grant the Chief Executive Officer of the United States Agency for Global Media, Michael Pack, with the authority to remove and replace members of OTF’s board.” Four removed members of the OTF Board had filed suit against pack. Yesterday, District of Columbia Attorney General Karl Racine (D) filed suit against USAGM, arguing that Pack violated District of Columbia law by dissolving the OTF Board and creating a new one.
  • Three advocacy organizations have lodged their opposition to the “California Privacy Rights Act” (aka Proposition 24) that will be on the ballot this fall in California. The American Civil Liberties Union, the California Alliance for Retired Americans, and Color of Change are speaking out against the bill because “it stacks the deck in favor of big tech corporations and reduces your privacy rights.” Industry groups have also started advertising and advocating against the statute that would rewrite the “California Consumer Privacy Act” (CCPA) (AB 375).

Further Reading

  • Facebook adds info label to Trump post about elections” – The Hill. Facebook has followed Twitter in appending information to posts of President Donald Trump that implicitly rebut his false claims about fraud and mail-in voting. Interestingly, they also appended information to posts of former Vice President Joe Biden that merely asked people to vote Trump out in November. If Facebook continues this policy, it is likely to stoke the ire of Republicans, many of whom claim that the platform and others are biased against conservative voices and viewpoints.
  • Ajit Pai urges states to cap prison phone rates after he helped kill FCC caps” – Ars Technica. The chair of the Federal Communications Commission (FC) is imploring states to regulate the egregious rates charged on payphones to the incarcerated in prison. The rub here is that Pai fought against Obama-era FCC efforts to regulate these practices, claiming the agency lacked the jurisdiction to police intrastate calls. Pai pulled the plug on the agency’s efforts to fight for these powers in court when he became chair.
  • Twitter bans 7,000 QAnon accounts, limits 150,000 others as part of broad crackdown” – NBC News. Today, Twitter announced it was suspending thousands of account of conspiracy theorists who believe a great number of untrue things, namely the “deep state” of the United States is working to thwart the presidency of Donald Trump. Twitter announced in a tweet: “[w]e will permanently suspend accounts Tweeting about these topics that we know are engaged in violations of our multi-account policy, coordinating abuse around individual victims, or are attempting to evade a previous suspension — something we’ve seen more of in recent weeks.” This practice, alternately called brigading or swarming, has been employed on a number of celebrities who are alleged to be engaging in pedophilia. The group, QAnon, has even been quoted or supported by Members of the Republican Party, some of whom may see Twitter’s actions as ideological.
  • Russia and China’s vaccine hacks don’t violate rules of road for cyberspace, experts say” – The Washington Post. Contrary to the claims of the British, Canadian, and American governments, attempts by other nations to hack into COVID-19 research is not counter to cyber norms these and other nations have been pushing to make the rules of the road. The experts interviewed for the article are far more concerned about the long term effects of President Donald Trump allowing the Central Intelligence Agency to start launching cyber attacks when and how it wishes.

© Michael Kans, Michael Kans Blog and michaelkans.blog, 2019-2020. Unauthorized use and/or duplication of this material without express and written permission from this site’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Michael Kans, Michael Kans Blog, and michaelkans.blog with appropriate and specific direction to the original content.

Executive Order Formalizes Review of Foreign Investment in Telecommunications

President Donald Trump has issued an executive order creating an inter-agency review body to determine whether foreign investment in U.S. telecommunications companies presents national security issues. However, the executive order merely formalizes and change the longstanding “Team Telecom” process through which proposed foreign investment in the U.S. telecommunications industry have been evaluated. Like the previous body, the new body will consist of representatives from the Departments of Defense, Homeland Security, and Justice and other agencies in an advisory role. Notably, a time limit will be set on how long these reviews should take. Moreover, a number of the changes will align this review process with the reforms enacted in 2018 to the Committee for Foreign Investment in the United States (CFIUS) process, and like the recent reforms to CFIUS, many of these reforms are aimed at countering Chinese companies’ growing investment in or purchase of U.S. companies in key industries.

The Executive Order (EO) “Establishing the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector” creates the new “Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector” (Committee) chaired by the Attorney General. The EO explained “the primary objective of which shall be to assist the Federal Communications Commission (FCC) in its public interest review of national security and law enforcement concerns that may be raised by foreign participation in the United States telecommunications services sector.” Moreover, the “The function of the Committee shall be:

(i) to review applications and licenses for risks to national security and law enforcement interests posed by such applications or licenses; and

(ii) to respond to any risks presented by applications or licenses by recommending to the FCC, as appropriate and consistent with the provisions of this order, that it dismiss an application, deny an application, condition the grant of an application upon compliance with mitigation measures, modify a license with a condition of compliance with mitigation measures, or revoke a license.”

The Committee “shall review and assess applications to determine whether granting a license or the transfer of a license poses a risk to national security or law enforcement interests of the United States” and must render its assessment within 120 days. If a secondary assessment is required “is warranted because risk to national security or law enforcement interests cannot be mitigated by standard mitigation measures,” then an additional 90 day review period may commence.

In a statement, Federal Communications Commission Chairman Ajit Pai said, “I applaud the President for formalizing Team Telecom review and establishing a process that will allow the Executive Branch to provide its expert input to the FCC in a timely manner.” He claimed that “[n]ow that this Executive Order has been issued, the FCC will move forward to conclude our own pending rulemaking on reform of the foreign ownership review process.” Pai stated that “[a]s we demonstrated last year in rejecting the China Mobile application, this FCC will not hesitate to act to protect our networks from foreign threats…[but] [a]t the same time, we welcome beneficial investment in our networks and believe that this Executive Order will allow us to process such applications more quickly.”

The pending rulemaking to which Pai referred was started under his predecessor former chair Tom Wheeler and would change the FCC’s review of foreign applications in these ways:

In this Notice of Proposed Rulemaking, we propose changes to our rules and procedures related to certain applications and petitions for declaratory ruling involving foreign ownership(together, “applications”). As discussed below, the Commission refers certain applications to the relevant Executive Branch agencies for their input on any national security, law enforcement, foreign policy, and trade policy concerns that may arise from the foreign ownership interests held in the applicants and petitioners (together, “applicants”). As part of our effort to reform the Commission’s processes, we seek to improve the timeliness and transparency of this referral process. More specifically, our goals here are to identify ways in which both the Commission and the agencies might streamline and facilitate the process for obtaining information necessary for Executive Branch review and identify expected time frames, while ensuring that we continue to take Executive Branch concerns into consideration as part of our public interest review.