NY State Senate Bill 2021-S4822

Senate Bill S4822

2021-2022 Legislative Session

Prohibits certain exclusivity policies imposed by digital application distribution platforms on digital application developers

download bill text pdf

Archive: Last Bill Status - In Senate Committee Internet And Technology Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 05, 2022	referred to internet and technology
Feb 12, 2021	referred to internet and technology

2021-S4822 (ACTIVE) - Details

See Assembly Version of this Bill:: A6526
Current Committee:: Senate Internet And Technology
Law Section:: General Business Law
Laws Affected:: Add Art 45 §§1500 & 1501, Gen Bus L
Versions Introduced in 2023-2024 Legislative Session:: A8835

2021-S4822 (ACTIVE) - Summary

Prohibits digital application distribution platforms from requiring digital application developers to exclusively make their product available on such platform, or from requiring such developer to exclusively use such platform's digital payment system on such developer's digital application.

2021-S4822 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S4822

SPONSOR: MAY
 
TITLE OF BILL:

An act to amend the general business law, in relation to prohibiting
certain exclusivity policies imposed by digital application distribution
platforms on digital application developers

 
PURPOSE:

Prohibits the owners of digital application distribution platforms from
imposing certain exclusivity policies on digital application developers.

 
SUMMARY OF PROVISIONS:

Section 1: Sets forth applicable definitions for "digital application,"
"developer," "digital application distribution platform," "Special-pur-
pose digital application distribution platform," and "digital payment
application."

Furthermore, it sets forth that the owner of a digital application
distribution platform with sales to New York State that exceed ten
million dollars in a calendar year cannot use exclusive practices by
requiring a developer to use either a digital application distribution
platform or a digital payment application. Retaliation against a devel-
oper for choosing an alternative in either case will not be permitted. A
contract that violates these provisions creates an unenforceable
contract. These provisions will not apply to the owner of a special-pur-
pose digital application distribution platform.  Furthermore, violations
of these provisions will be investigated by the New York State Attorney
General, which will also have the authority to bring legal actions in
such cases.

Section 2: Sets the effective date.

 
JUSTIFICATION:

Large tech companies often require users and developers to process all
their transactions through a single app store or payment processor.  In
doing so, they create walled gardens within their own proprietary plat-
forms and reduce the ability of independent developers to distribute
their digital products through platforms of their choice.  This
increases the profits of the large companies and denies options to both
developers and consumers, who may find better options through third-par-
ty sellers. This legislation seeks to level the playing field by prohib-
iting such walled gardens in platforms in New York state and to protect
customers from monopolistic practices by large companies.

 
FISCAL IMPACT:

To be determined.

 
LEGISLATIVE HISTORY:

New bill.

 
EFFECTIVE DATE:
This act shall take effect immediately.

2021-S4822 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4822
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             February 12, 2021
                                ___________
 
 Introduced  by  Sen.  MAY  --  read  twice and ordered printed, and when
   printed to be committed to the Committee on Internet and Technology
 
 AN ACT to amend the general business law,  in  relation  to  prohibiting
   certain  exclusivity  policies imposed by digital application distrib-
   ution platforms on digital application developers

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The general business law is amended by adding a new article
 45 to read as follows:
                                ARTICLE 45
                           DIGITAL APPLICATIONS
 SECTION 1500. DEFINITIONS.
         1501. DIGITAL APPLICATION DISTRIBUTION PLATFORMS.
   §  1500.  DEFINITIONS.  AS  USED  IN THIS ARTICLE, THE FOLLOWING TERMS
 SHALL HAVE THE FOLLOWING MEANINGS:
   1. "DIGITAL APPLICATION" MEANS ANY  APPLICATION  SOFTWARE  PROGRAM  OR
 GROUP OF PROGRAMS DESIGNED TO BE DOWNLOADED OR ACCESSED ON AN ELECTRONIC
 DEVICE  INCLUDING, BUT NOT LIMITED TO A COMPUTER, SMARTPHONE, TABLET, OR
 OTHER SIMILAR DEVICE BY AN END-USER.
   2. "DEVELOPER" MEANS THE CREATOR OF A DIGITAL APPLICATION MADE  AVAIL-
 ABLE  FOR  DOWNLOAD  BY END-USERS THROUGH A DIGITAL APPLICATION DISTRIB-
 UTION PLATFORM OR OTHER DIGITAL DISTRIBUTION PLATFORM.
   3.  "DIGITAL  APPLICATION  DISTRIBUTION  PLATFORM"  MEANS  A   DIGITAL
 DISTRIBUTION  PLATFORM  FOR APPLICATIONS AND SERVICES PROVIDED TO A USER
 ON AN ELECTRONIC DEVICE INCLUDING, BUT NOT  LIMITED  TO,  A  SMARTPHONE,
 TABLET, COMPUTER, OR OTHER SIMILAR DEVICE.
   4. "SPECIAL-PURPOSE DIGITAL APPLICATION DISTRIBUTION PLATFORM" MEANS A
 DIGITAL  DISTRIBUTION  PLATFORM  FOR SINGLE OR SPECIALIZED CATEGORIES OF
 DIGITAL APPLICATIONS, SOFTWARE, AND SERVICES PROVIDED TO AN END-USER  ON
 SPECIAL-PURPOSE  HARDWARE  INCLUDING,  BUT  NOT  LIMITED  TO,  A  GAMING
 CONSOLE, MUSIC PLAYER, OR OTHER SIMILAR SPECIAL-PURPOSE DEVICE.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD09768-01-1

 S. 4822                             2
 
   5. "DIGITAL PAYMENT APPLICATION" MEANS A DIGITAL APPLICATION, SERVICE,
 OR USER INTERFACE USED TO PROCESS A PAYMENT OR MONEY  TRANSFER  FROM  AN
 INDIVIDUAL OR ENTITY TO ANOTHER INDIVIDUAL OR ENTITY.
   § 1501. DIGITAL APPLICATION DISTRIBUTION PLATFORMS. 1. A PROPRIETOR OF
 A  DIGITAL  APPLICATION DISTRIBUTION PLATFORM FOR WHICH CUMULATIVE GROSS
 RECEIPTS FROM SALES ON SUCH DIGITAL APPLICATION DISTRIBUTION PLATFORM TO
 RESIDENTS OF THIS STATE EXCEED TEN MILLION DOLLARS IN  THE  PREVIOUS  OR
 CURRENT CALENDAR YEAR SHALL NOT:
   (A) REQUIRE A DEVELOPER TO USE A SPECIFIC DIGITAL APPLICATION DISTRIB-
 UTION  PLATFORM AS THE EXCLUSIVE MODE OF DISTRIBUTING A DIGITAL APPLICA-
 TION OR OTHER DIGITAL PRODUCT;
   (B) REQUIRE A DEVELOPER TO USE A SPECIFIC DIGITAL PAYMENT  APPLICATION
 AS  THE  EXCLUSIVE  MODE  OF ACCEPTING PAYMENT FROM A USER TO DOWNLOAD A
 DIGITAL APPLICATION OR PURCHASE A DIGITAL OR  PHYSICAL  PRODUCT  THROUGH
 SUCH DIGITAL APPLICATION; OR
   (C)  RETALIATE  AGAINST A DEVELOPER FOR CHOOSING TO USE AN ALTERNATIVE
 DIGITAL APPLICATION DISTRIBUTION PLATFORM OR  DIGITAL  PAYMENT  APPLICA-
 TION.
   2. ANY CONTRACT OR AGREEMENT THAT VIOLATES THIS SECTION SHALL BE UNEN-
 FORCEABLE AND SHALL BE DEEMED A VIOLATION OF THIS SECTION.
   3.  THIS  SECTION SHALL NOT APPLY TO A PROPRIETOR OF A SPECIAL-PURPOSE
 DIGITAL APPLICATION DISTRIBUTION PLATFORM.
   4. THE ATTORNEY  GENERAL  SHALL  RECEIVE  COMPLAINTS  AND  INVESTIGATE
 VIOLATIONS  OF  THIS  SECTION  AND  MAY  BRING AN ACTION IN ANY COURT OF
 COMPETENT JURISDICTION TO OBTAIN LEGAL OR EQUITABLE RELIEF ON BEHALF  OF
 AN INDIVIDUAL AGGRIEVED BY A VIOLATION OF THIS SECTION.
   § 2. This act shall take effect immediately.

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