The news: Senate and House officials across party lines revealed the American Privacy Rights Act, a bill that would establish federal guidelines for how digital advertising companies and large platforms can collect and use consumers’ personal data online.

• Major components of the bill would override state-level measures, allow users to opt out of targeted advertising and request that personal data be deleted or handed over, and give users the right to sue companies that fail to meet such requests.
• Major ad industry players like Google, Meta, and groups like The Association of National Advertisers have called for exactly such a federal privacy law to override disparate state-level bills that complicate the digital advertising business.

Not a moment too soon: The bipartisan legislation was revealed just as Maryland passed two of its own sweeping data privacy bills that significantly restricted how companies can use and gather personal information, particularly with regards to minors.

• If signed into law, the Maryland Online Data Privacy Act and Maryland Kids Code would restrict how data can be collected and exchanged. They would forbid tracking of users under age 18—as well as restrict platforms’ ability to use features like auto-playing videos and notifications that are designed to keep users glued to devices.
• US federal regulation regarding data privacy has significantly lagged behind Europe, where regulators have spent recent years issuing major fines against internet giants and passing sweeping laws like the General Data Protection Regulation and Digital Markets Act.
• That gap has left room for states to fill the void, creating a fractured US data privacy landscape where rules vary dramatically from state to state, as well as prickly regulatory environment for the $302 million American digital advertising industry.

What are its chances? The privacy bill was spearheaded by Senator Maria Cantwell (D-WA) and House Representative Cathy McMorris Rodgers (R-WA), both chairs of their respective chamber’s commerce committees. The bipartisan support across both chambers of Congress makes it more likely that the bill will come to fruition.

What it means for digital advertisers: If the American Privacy Rights Act passes, legal battles could follow to determine whether the federal government or states have jurisdiction over data privacy—in other words, the conflict isn’t over yet.

• But should the bill pass, advertisers and data brokers will have to come to terms with the reality that the landscape surrounding data privacy is changing, and companies need to comply or face significant legal consequences.
• That means now is the time for advertisers to start adapting to the changes outlined in the act.

Go further: Learn more about the EU’s sweeping privacy laws and how they impact marketers here.