A regulatory watchdog is petitioning the US Federal Trade Commission to establish a trade regulation framework for online companies such as Facebook, Twitter and Google.
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The Center for Regulatory Effectiveness said such a framework will protect US-based online companies by defining acceptable and unacceptable acts or practices.
A sound and legal framework will avoid web companies and services inadvertently harming, not enhancing their businesses, said the Center for Regulatory Effectiveness (CRE).
The US Federal Trade Commission (FTC) has authority to ban only acts or practices that cause or are likely to cause "substantial injury to consumers which is not reasonably avoidable by consumers themselves and not outweighed by countervailing benefits to consumers or to competition."
In the absence of a rule for web-based services, the FTC would lack a sound intellectual and legal framework for its work, creating the perception that the agency was interpreting ambiguous rules to obtain a preconceived solution, said the CRE.
According to the CRE, the main benefactors to this proposed legal framework include Google, Twitter and Facebook, which are already under investigation by the FTC.
Google is being probed about business operations in its core search advertising business, Twitter is under scrutiny claims that it takes advantage of developers who use the platform to build products and services and Facebook has come under fire over its privacy policies.