[Federal Register Volume 75, Number 64 (Monday, April 5, 2010)]
[Proposed Rules]
[Pages 17089-17093]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-7549]


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FEDERAL TRADE COMMISSION

16 CFR Part 312


Request for Public Comment on the Federal Trade Commission's 
Implementation of the Children's Online Privacy Protection Rule

AGENCY: Federal Trade Commission.

ACTION: Request for public comment.

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SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'') 
requests public comment on its implementation of the Children's Online 
Privacy Protection Act (``COPPA'' or ``the Act''), through the 
Children's Online Privacy Protection Rule (``COPPA Rule'' or ``the 
Rule''),. The Commission requests comment on the costs and benefits of 
the Rule, as well as on whether it, or certain sections, should be 
retained, eliminated, or modified. All interested persons are hereby 
given notice of the opportunity to submit written data, views, and 
arguments concerning the Rule.

DATES: Written comments must be received by June 30, 2010.

ADDRESSES: Interested parties are invited to submit written comments 
electronically or in paper form, by following the instructions in the 
Invitation To Comment part of the ``SUPPLEMENTARY INFORMATION'' section 
below. Comments in electronic form should be submitted by using the 
following weblink: (https://public.commentworks.com/ftc/2010copparulereview) (and following the instructions on the web-based 
form). Comments in paper form should be mailed or delivered to the 
following address: Federal Trade Commission, Office of the Secretary, 
Room H-135 (Annex E), 600 Pennsylvania Avenue, NW, Washington, DC 
20580, (202) 326-2252.

FOR FURTHER INFORMATION CONTACT: Phyllis Marcus, (202) 326-2854, or 
Mamie Kresses, (202) 326-2070, Attorneys, Federal Trade Commission, 
Division of Advertising Practices, Federal Trade Commission, 
Washington, D.C. 20580.

SUPPLEMENTARY INFORMATION:

Section I. Background

    The COPPA Rule, issued pursuant to the Children's Online Privacy 
Protection Act, 15 U.S.C. Sec.  6501, et seq., became effective on 
April 21, 2000. The Rule imposes certain requirements on operators of 
websites or online services directed to children under 13 years of age, 
and on operators of other websites or online services that have actual 
knowledge that they are collecting personal information online from a 
child under 13 years of age (collectively, ``operators'').\1\ Among 
other things, the Rule requires that operators provide notice to 
parents and obtain verifiable parental consent prior to collecting, 
using, or disclosing personal information from children under 13 years 
of age. The Rule also requires operators to keep secure the information 
they collect from children and prohibits them from conditioning 
children's participation in activities on the collection of more 
personal information than is reasonably necessary to participate in 
such activities. Further, the Rule contains a ``safe harbor'' provision 
enabling industry groups or others to submit to the Commission for 
approval self-regulatory guidelines that would implement the Rule's 
protections.\2\
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    \1\ 16 CFR Part 312.
    \2\ See 16 CFR Part 312.10; 64 FR at 59906-59908, 59915.
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Section II. Rule Review

    COPPA and Sec.  312.11 of the Rule required the Commission to 
initiate a review no later than five years after the Rule's effective 
date to evaluate the Rule's implementation. The Commission commenced 
this mandatory review on April 21, 2005. After receiving and 
considering extensive public comment on the Rule, the Commission 
determined in March 2006 to retain the COPPA Rule without change.\3\ 
However, the Commission believes that changes to the online environment 
over the past five years, including but not limited to children's 
increasing use of mobile technology to access the Internet, warrant 
reexamining the Rule at this time.
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    \3\ See 71 FR 13247 (Mar. 15, 2006).
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    In this notice, the Commission poses its standard regulatory review 
questions to determine whether the Rule should be retained, eliminated, 
or modified. In addition, the Commission identifies several areas where 
public comment would be especially useful. First, the Commission asks 
whether the Rule's current definitions are sufficiently clear and 
comprehensive, or whether they might warrant modification or expansion, 
consistent with the COPPA statute. Among other questions, the 
Commission asks for comment on the application of the definition of 
``Internet'' to mobile communications, interactive television, 
interactive gaming, and similar activities. Further, the Commission 
asks whether the Rule's definition of ``personal information'' should 
be expanded to include other items of information that can be collected 
from children online and are not currently specified in the Rule, such 
as persistent IP addresses, mobile geolocation information, or 
information collected in connection with online behavioral advertising.
    The Commission also seeks comment on the use of automated systems 
for reviewing children's web submissions (e.g., those that filter out 
any personally identifiable information prior to posting). In addition, 
the Commission asks whether change is warranted as to the Rule 
provisions on protecting the confidentiality and security of personal 
information, the right of parents to review or delete personal 
information, and the prohibition against conditioning a child's 
participation on the collection of personal information. Finally, the 
Commission seeks comment about its role in administering the Rule's 
safe harbor provisions.

Section III. Questions Regarding the COPPA Rule

    The Commission invites members of the public to comment on any 
issues or concerns they believe are relevant or appropriate to the 
Commission's review of the COPPA Rule, and to submit written data, 
views, facts, and arguments addressing the Rule. All comments should be 
filed as prescribed in the Invitation To Comment part of the 
``SUPPLEMENTARY INFORMATION'' section below, and must be received by 
June 30, 2010. The Commission is particularly interested in comments 
addressing the following questions:

A. General Questions for Comment

    1. Is there a continuing need for the Rule as currently 
promulgated? Why or why not?
    a. Since the Rule was issued, have changes in technology, industry, 
or economic conditions affected the need for or effectiveness of the 
Rule?
    b. What are the aggregate costs and benefits of the Rule?
    c. Does the Rule include any provisions not mandated by the Act 
that are unnecessary or whose costs outweigh their benefits? If so, 
which ones and why?

[[Page 17090]]

    2. What effect, if any, has the Rule had on children, parents, or 
other consumers?
    a. Has the Rule benefitted children, parents, or other consumers? 
If so, how?
    b. Has the Rule imposed any costs on children, parents, or other 
consumers? If so, what are these costs?
    c. What changes, if any, should be made to the Rule to increase its 
benefits, consistent with the Act's requirements? What costs would 
these changes impose?
    3. What impact, if any, has the Rule had on operators?
    a. Has the Rule provided benefits to operators? If so, what are 
these benefits?
    b. Has the Rule imposed costs on operators, including costs of 
compliance in time or monetary expenditures? If so, what are these 
costs?
    c. What changes, if any, should be made to the Rule to reduce the 
costs imposed on operators, consistent with the Act's requirements? How 
would these changes affect the Rule's benefits?
    4. How many small businesses are subject to the Rule? What costs 
(types and amounts) do small businesses incur in complying with the 
Rule? How has the Rule otherwise affected operators that are small 
businesses? Have the costs or benefits of the Rule changed over time 
with respect to small businesses? What regulatory alternatives, if any, 
would decrease the Rule's burden on small businesses, consistent with 
the Act's requirements?
    5. Does the Rule overlap or conflict with any other federal, state, 
or local government laws or regulations? How should these overlaps or 
conflicts be resolved, consistent with the Act's requirements?
    a. Are there any unnecessary regulatory burdens created by 
overlapping jurisdiction? If so, what can be done to ease the burdens, 
consistent with the Act's requirements?
    b. Are there any gaps where no federal, state, or local government 
law or regulation has addressed a problematic practice relating to 
children's online privacy? Could or should any such gaps be remedied by 
a modification to the Rule?

B. Definitions

    6. Do the definitions set forth in Sec.  312.2 of the Rule 
accomplish COPPA's goal of protecting children's online privacy and 
safety?
    7. Are the definitions in Sec.  312.2 clear and appropriate? If 
not, how can they be improved, consistent with the Act's requirements?
    8. Should the definitions of ``collects or collection'' and/or 
``disclosure'' be modified in any way to take into account online 
technologies and/or Internet activities and features that have emerged 
since the Rule was enacted or that may emerge in the future? For 
instance, how will the use of centralized authentication methods (e.g., 
OpenId) affect individual websites' COPPA compliance efforts?
    9. The Rule considers personal information to have been 
``collected'' where an operator enables children to make personal 
information publicly available through a chat room, message board, or 
other means, except where the operator ``deletes'' all individually 
identifiable information from postings by children before they are made 
public and deletes such information from the operator's records.
    a. Are there circumstances in which an operator using an automated 
system of review and/or posting meets the deletion exception to the 
definition of collection?
    b. Does the Rule's current definition of ``delete'' provide 
sufficient guidance to operators about how to handle the removal of 
personal information?
    10. Should the definition of ``collection'' be modified or 
clarified to include other means of collection of personal information 
from children that are not specifically enumerated in the Rule's 
current definition?
    11. What are the implications for COPPA enforcement raised by 
technologies such as mobile communications, interactive television, 
interactive gaming, or other similar interactive media, consistent with 
the Act's definition of ``Internet''?
    12. The Rule defines ``personal information'' as individually 
identifiable information about an individual collected online, and 
enumerates such items of information. Do the items currently enumerated 
as ``personal information'' need to be clarified or modified in any 
way, consistent with the Act?
    13. Section 1302(8)(F) of the Act provides the Commission with 
discretion to include in the definition of ``personal information'' any 
identifier that it determines would permit the physical or online 
contacting of a specific individual.
    a. Do operators, including network advertising companies, have the 
ability to contact a specific individual, either physically or online, 
using one or more pieces of information collected from children online, 
such as user or screen names and/or passwords, zip code, date of birth, 
gender, persistent IP addresses, mobile geolocation information, 
information collected in connection with online behavioral advertising, 
or other emerging categories of information? Are operators using such 
information to contact specific individuals?
    b. Should the definition of ``personal information'' in the Rule be 
expanded to include any such information?
    14. Are providers of downloadable software collecting information 
from children that permits the physical or online contacting of a 
specific individual?
    15. Should the Rule define ``the physical or online contacting of a 
specific individual,'' ``website,'' ``online service,'' or any other 
term not currently defined? If so, how should such terms be defined, 
consistent with the Act's requirements?

C. Notice

    16. Section 312.4 of the Rule sets out the requirements for the 
content and delivery of operators' notices of their information 
practices with regard to children.
    a. Are the requirements in this Part clear and appropriate? If not, 
how can they be improved?
    b. Should the notice requirements be clarified or modified in any 
way to reflect changes in the types or uses of children's information 
collected by operators or changes in communications options available 
between operators and parents?

D. Parental Consent

    17. Section 312.5 of the Rule requires operators to obtain 
verifiable parental consent before collecting, using, and/or disclosing 
personal information from children, including consent to any material 
change to practices to which the parent previously consented. This Part 
further requires operators to make reasonable efforts to obtain this 
consent, which efforts are reasonably calculated to ensure that the 
person providing consent is the child's parent, taking into 
consideration available technology.
    a. Has the consent requirement been effective in protecting 
children's online privacy and safety?
    b. What data exists on: (1) operators' use of parental consent 
mechanisms; (2) parents' awareness of the Rule's parental consent 
requirements; or (3) parents' response to operators' parental consent 
requests?
    18. Section 312.5(b)(2) of the Rule provides a non-exhaustive list 
of approved methods to obtain verifiable parental consent, including: 
providing a consent form to be signed by the parent and returned to the 
operator; requiring a parent to use a credit card in connection with a 
transaction; having a parent call a toll-free number staffed by trained 
personnel; using a digital

[[Page 17091]]

certificate that uses public key technology; and using email 
accompanied by a PIN/password obtained through one of the other 
enumerated verification methods.
    a. To what extent are operators using each of the enumerated 
methods? Please provide as much specific data as possible, including 
the costs and benefits associated with each method described.
    b. Are there additional methods to obtain verifiable parental 
consent, based on current or emerging technological changes, that 
should be added to Sec.  312.5 of the Rule? What are the costs and 
benefits of these additional methods?
    c. Should any of the currently enumerated methods to obtain 
verifiable parental consent be removed from the Rule? If so, please 
explain which one(s) and why.
    d. Are there methods for delivering a signed consent form, other 
than postal mail or facsimile, that would meet the Rule's standards for 
verifiable parental consent? Should these be specified in the Rule?
    e. Are there current or emerging forms of payment, other than the 
use of a credit card in connection with a transaction, that would meet 
the Rule's standards for verifiable parental consent? Should these be 
specified in the Rule?
    f. The Rule permits use of a credit card in connection with a 
transaction to serve as a form of verifiable parental consent. Is there 
data available on the proliferation of credit cards, debit cards, or 
gift cards among children under 13 years of age? What challenges, if 
any, does children's use of credit, debit, and/or gift cards pose for 
Rule compliance or enforcement?
    g. Are there current or emerging forms of oral communication, other 
than the use of a toll-free telephone number staffed by trained 
personnel, that would meet the Rule's standards for verifiable parental 
consent? Should these be specified in the Rule?
    19. Section 312.5(b)(2) also sets forth a mechanism that operators 
can use to obtain verifiable parental consent for uses of information 
other than ``disclosures'' (the ``email plus mechanism''). The email 
plus mechanism permits the use of an email coupled with additional 
steps to provide assurances that the person providing consent is the 
parent, including sending a confirmatory email to the parent following 
receipt of consent or obtaining a postal address or telephone number 
from the parent and confirming the parent's consent by letter or 
telephone call. In 2006, the Commission announced that it would retain 
the email plus mechanism indefinitely. See (http://www.ftc.gov/os/fedreg/2006/march/060315childrens-online-privacy-rule.pdf).
    a. Does the email plus mechanism remain a viable form of verifiable 
parental consent for operators' internal uses of information?
    b. Are there other current or emerging forms of communications, not 
enumerated in Sec.  312.5(b)(2), that would meet the Rule's standards 
for verifiable parental consent for operators' internal uses of 
information? Are any changes or modifications to this Part warranted?

E. Exceptions to Verifiable Parental Consent

    20. COPPA and Sec.  312.5(c) of the Rule set forth five exceptions 
to the prior parental consent requirement. Are the exceptions in Sec.  
312.5(c) clear? If not, how can they be improved, consistent with the 
Act's requirements?
    21. Section 312.5(c)(3) of the Rule requires that operators who 
collect children's online contact information for the sole purpose of 
communicating directly with a child after the child has specifically 
requested such communication must provide parents with notice and the 
opportunity to opt-out of the operator's further use of the information 
(the ``multiple contact'' exception).
    a. To what extent are operators using the multiple contact 
exception to communicate or engage with children on an ongoing basis? 
Are operators relying on the multiple contact exception to collect more 
than just online contact information from children?
    b. Should the multiple contact exception be clarified or modified 
in any way, consistent with the Act's requirements, to take into 
account any changes in the manner in which operators communicate or 
engage with children?
    c. Under this Part, acceptable notice mechanisms include sending 
the opt-out notice by postal mail or to the parent's email address. 
Should Sec.  312.5(c)(3) be modified to remove postal mail as a means 
of delivering an opt-out notice to parents?
    d. Should Sec.  312.5(c)(3) be otherwise clarified or modified in 
any way to reflect current or emerging technological changes that have 
or may expand options for the online contacting of children or options 
for communications between operators and parents?
    22. Section 312.5(c)(4) of the Rule requires an operator who 
collects a child's name and online contact information to the extent 
reasonably necessary to protect the safety of a child participant in 
the website or online service to use reasonable efforts to provide a 
parent notice and the opportunity to opt-out of the operator's use of 
such information. Such information must only be used to protect the 
child's safety, cannot be used to re-contact the child or any other 
purpose, and may not be disclosed.
    a. To what extent, and under what circumstances, do operators use 
Sec.  312.5(c)(4) to protect children's safety?
    b. Are the requirements of Sec.  312.5(c)(4) clear and appropriate? 
If not, how can they be improved, consistent with the Act's 
requirements?
    23. Section 312.5(c)(5) of the Rule permits operators to collect a 
child's name and online contact information to protect the security or 
integrity of the site, take precautions against liability, respond to 
judicial process, or to provide information to law enforcement agencies 
or in connection with a public safety investigation.
    a. To what extent, and under what circumstances, do operators use 
Sec.  312.5(c)(5)?
    b. Are the requirements of Sec.  312.5(c)(5) clear and appropriate? 
If not, how can they be improved, consistent with the Act's 
requirements? For example, should Sec.  312.5(c)(5) of the Rule be 
clarified to allow operators to collect and maintain a child's name 
and/or online contact information for the purpose of preventing future 
attempts at registration?

F. Right of a Parent to Review and/or Have Personal Information Deleted

    24. Section 312.6(a) of the Rule requires operators to give 
parents, upon their request: (1) a description of the specific types of 
personal information collected from children; (2) the opportunity to 
refuse to permit the further use or collection of personal information 
from the child and to direct the deletion of the information; and (3) a 
means of reviewing any personal information collected from the child. 
In the case of a parent who wishes to review the personal information 
collected from the child, Sec.  312.6(a)(3) of the Rule requires 
operators to provide a means of review that ensures that the requestor 
is a parent of that child (taking into account available technology) 
and is not unduly burdensome to the parent.
    a. To what extent are parents exercising their rights under Sec.  
312.6(a)(1) to obtain from operators a description of the specific 
types of personal information collected from children?
    b. To what extent are parents exercising their rights under Sec.  
312.6(a)(2) to refuse to permit the

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further use or collection of personal information from the child and to 
direct the deletion of the information?
    c. To what extent are parents exercising their rights under Sec.  
312.(a)(3) to review any personal information collected from the child?
    d. Do the costs and burdens to operators or parents differ 
depending on whether a parent seeks a description of the information 
collected, access to the child's information, or to have the child's 
information deleted?
    e. Is it difficult for operators to ensure, taking into account 
available technology, that a requester seeking to review the personal 
information collected from a child is a parent of that child?
    f. Should Sec.  312.6(a)(3) enumerate the methods an operator may 
use to ensure that a requestor seeking to review the personal 
information collected from a child is a parent of that child? Should 
these methods be consistent with the verification methods enumerated 
currently or in the future in Sec.  312.5(b)(2) of the Rule?
    g. Are the requirements of Sec.  312.6 clear and appropriate? If 
not, how can they be improved, consistent with the Act's requirements?

G. Prohibition Against Conditioning a Child's Participation on 
Collection of Personal Information

    25. COPPA and Sec.  312.7 of the Rule prohibit operators from 
conditioning a child's participation in an activity on disclosing more 
personal information than is reasonably necessary to participate in 
such activity.
    a. Do operators take this requirement into account when shaping 
their online offerings to children?
    b. Has the prohibition been effective in protecting children's 
online privacy and safety?
    c. Is Sec.  312.7 of the Rule clear and adequate? If not, how could 
it be improved, consistent with the Act's requirements?

H. Confidentiality, Security and Integrity of Personal Information

    26. Section 312.8 of the Rule requires operators to establish and 
maintain reasonable procedures to protect the confidentiality, 
security, and integrity of personal information collected from a child.
    a. Have operators implemented sufficient safeguards to protect the 
confidentiality, security, and integrity of personal information 
collected from a child?
    b. Is Sec.  312.8 of the Rule clear and adequate? If not, how could 
it be improved, consistent with the Act's requirements?

I. Safe Harbors

    27. Section 312.10 of the Rule provides that an operator will be 
deemed in compliance with the Rule's requirements if the operator 
complies with Commission-approved self-regulatory guidelines (the 
``safe harbor'' process).
    a. Has the safe harbor process been effective in enhancing 
compliance with the Rule?
    b. Should the criteria for Commission approval of a safe harbor 
program be modified in any way to strengthen the standards currently 
enumerated in Sec.  312.10(b)?
    c. Should Sec.  312.10 be modified to include a requirement that 
approved safe harbor programs undergo periodic reassessment by the 
Commission? If so, how often should such assessments be required?
    d. Should Sec.  312.10(b)(4) of the Rule, regarding the 
Commission's discretion to initiate an investigation or bring an 
enforcement action against an operator participating in a safe harbor 
program, be clarified or modified in any way?
    e. Should any other changes be made to the criteria for approval of 
self-regulatory guidelines, or to the safe harbor process, consistent 
with the Act's requirements?

J. Statutory Requirements

    28. Does the commenter propose any modifications to the Rule that 
may conflict with the statutory provisions of the COPPA Act? For any 
such proposed modification, does the commenter propose seeking 
legislative changes to the Act?

Section IV. Invitation to Comment

    All persons are hereby given notice of the opportunity to submit 
written data, views, facts, and arguments pertinent to this rule 
review. Written comments must be received on or before June 30, 2010, 
and may be submitted electronically or in paper form. Comments should 
refer to ``COPPA Rule Review, P104503'' to facilitate the organization 
of comments. Please note that your comment - including your name and 
your state - will be placed on the public record of this proceeding, 
including on the publicly accessible FTC website, at (http://www.ftc.gov/os/publiccomments.shtm).
    Because comments will be made public, they should not include any 
sensitive personal information, such as any individual's Social 
Security number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. Comments also 
should not include any sensitive health information, such as medical 
records or other individually identifiable health information. In 
addition, comments should not include any ``[t]rade secret or any 
commercial or financial information which is obtained from any person 
and which is privileged or confidential. . . ,'' as provided in Section 
6(f) of the Federal Trade Commission Act (``FTC Act''), 15 U.S.C. 
46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). Comments containing 
material for which confidential treatment is requested must be filed in 
paper form, must be clearly labeled ``Confidential,'' and must comply 
with FTC Rule 4.9(c), 16 CFR 4.9(c).\4\
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    \4\ The comment must be accompanied by an explicit request for 
confidential treatment, including the factual and legal basis for 
the request, and must identify the specific portions of the comment 
to be withheld from the public record. The request will be granted 
or denied by the Commission's General Counsel, consistent with 
applicable law and the public interest. See FTC Rule 4.9(c), 16 
C.F.R. 4.9(c).
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    Because paper mail addressed to the FTC is subject to delay due to 
heightened security screening, please consider submitting your comments 
in electronic form. Comments filed in electronic form should be 
submitted by using the following weblink: (https://public.commentworks.com/ftc/2010copparulereview) (and following the 
instructions on the web-based form). To ensure that the Commission 
considers an electronic comment, you must file it at (https://public.commentworks.com/ftc/2010copparulereview). If this document 
appears at (http://www.regulations.gov/search/Regs/home.html#home), you 
may also file an electronic comment through that website. The 
Commission will consider all comments that regulations.gov forwards to 
it. You may also visit the FTC website at (http://www.ftc.gov) to read 
the document and the news release describing it.
    A comment filed in paper form should include the ``COPPA Rule 
Review, P104503'' reference both in the text and on the envelope, and 
should be mailed or delivered to the following address: Federal Trade 
Commission, Office of the Secretary, Room H-135 (Annex E), 600 
Pennsylvania Avenue, NW, Washington, DC 20580. The FTC is requesting 
that any comment filed in paper form be sent by courier or overnight 
service, if possible, because U.S. postal mail in the Washington area 
and at the Commission is subject to

[[Page 17093]]

delay due to heightened security precautions.
    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. The Commission will consider all timely and responsive 
public comments that it receives, whether filed in paper or electronic 
form. Comments received will be available to the public on the FTC 
website, to the extent practicable, at (http://www.ftc.gov/os/publiccomments.shtm). As a matter of discretion, the Commission makes 
every effort to remove home contact information for individuals from 
the public comments it receives before placing those comments on the 
FTC website. More information, including routine uses permitted by the 
Privacy Act may be found in the FTC's privacy policy, at (http://www.ftc.gov/ftc/privacy.shtm).

Section V. Communications by Outside Parties to Commissioners or Their 
Advisors

    Written communications and summaries of transcripts of oral 
communications respecting the merits of this proceeding from any 
outside party to any Commissioner or Commissioner's advisor will be 
placed on the public record.\5\
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    \5\ See 16 CFR Part 1.26(b)(5).
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List of Subjects in 16 CFR Part 312

    Children, Communications, Consumer protection, Electronic mail, E-
mail, Internet, Online service, Privacy, Record retention, Safety, 
Science and technology, Trade practices, Website, Youth.

    Authority: 15 U.S.C. Sec. Sec.  6501-6508.
    By direction of the Commission.

Donald S. Clark,
Secretary.
[FR Doc. 2010-7549 Filed 4-2-10; 10:31 am]
BILLING CODE 6750-01-S