Eyeing China, US House unanimously passes bill prohibiting ‘sensitive data’ transfers to foreign adversaries

Legislation would block sale of government-issued identifiers, financial account numbers, genetic information and private communications like emails
Sale of such data poses ‘a unique threat to national security and individual privacy’, says bill’s sponsor Frank Pallone, Democrat of New Jersey

US-China relations

Bochen Hanin Washington

Published: 2:20am, 21 Mar 2024

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The US House of Representatives unanimously passed a bipartisan bill on Wednesday that would prohibit data brokers from transferring Americans’ “sensitive data” to foreign adversary countries including China.

After clearing the House by a 414-0 vote, the legislation now needs to be passed in the Democratic-controlled Senate and signed by US President Joe Biden to become law.

Sponsored by Frank Pallone of New Jersey, the ranking Democrat on the House Energy and Commerce Committee, the bill would block the sale of government-issued identifiers, financial account numbers, genetic information, precise geolocation information and private communications like emails.

The committee’s chair, Washington Republican Cathy McMorris Rodgers, co-sponsored the bill.

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“The breadth and scope of sensitive personal information aggregated by data brokers makes the sale of that data to our foreign adversaries a unique threat to national security and individual privacy”, Pallone said on Tuesday.

Countries like China could use that information “to launch sophisticated influence campaigns [and] conduct espionage”, he added.

Pallone’s legislation was introduced in conjunction with a bill that would force the Beijing-based owner of popular short-video platform TikTok to divest the app or face a ban from operating in the US.

Lawmakers are concerned that the Chinese government would compel TikTok to provide US user data for surveillance or influence campaigns.

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Raja Krishnamoorthi of Illinois, the Democratic co-sponsor of that bill, which passed last week in the House, said the two bills complemented each other as limiting data brokers’ access “prevents our foreign adversaries from buying American data through other sources” if they cannot directly access data through TikTok.

The targeting of data brokers through the bill follows a White House executive order in February that similarly restricts the sale of Americans’ sensitive information to “countries of concern” – which is likely to include China and Russia.

The measure also follows several stalled attempts to enact comprehensive national data privacy legislation to restrict companies’ data collection and transfer practices – something that critics of efforts to ban TikTok propose as a better solution for Americans’ data privacy.

Pallone on Tuesday said his bill represented the beginning of that process.

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However, Bruce Schneier, a lecturer at the Harvard Kennedy School and author of Data and Goliath: The Hidden Battles to Collect Your Data and Control Your World, said it was “unlikely” that such comprehensive legislation would pass.

“We in the United States do not pass laws that billionaires don’t like”, he said, naming Facebook, Google, and Elon Musk, who owns social media platform X (formerly Twitter), as actors who rely on data collection as part of their business model.

Schneier welcomed Wednesday’s vote but called it “an extraordinarily minor” step in protecting Americans from countries who seek their data.

Companies and countries like China who want to buy that data will “find a middleman, unfortunately”, he said.