89R13359 MLH-F     By: Shaheen H.B. No. 4294       A BILL TO BE ENTITLED   AN ACT   relating to the regulation of platforms for the sale and   distribution of software applications for mobile devices;   authorizing a civil penalty.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subtitle C, Title 5, Business & Commerce Code, is   amended by adding Chapter 121 to read as follows:   CHAPTER 121.  SOFTWARE APPLICATIONS   SUBCHAPTER A.  GENERAL PROVISIONS          Sec. 121.001.  DEFINITIONS. In this chapter:                (1)  "Age category" means information collected by the   owner of an app store to designate a user based on the age   categories described by Section 121.021(b).                (2)  "App store" means a publicly available Internet   website, software application, or other electronic service that   distributes software applications from the owner or developer of a   software application to the user of a mobile device.                (3)  "Minor" means an individual who is younger than 18   years of age who has not had the disabilities of minority removed   for general purposes.                (4)  "Mobile device" means a portable, wireless   electronic device, including a tablet or smartphone, capable of   transmitting, receiving, processing, and storing information   wirelessly that runs an operating system designed to manage   hardware resources and perform common services for software   applications on handheld electronic devices.                (5)  "Personal data" means any information, including   sensitive data, that is linked or reasonably linkable to an   identified or identifiable individual. The term includes   pseudonymous data when the data is used by a person who processes or   determines the purpose and means of processing the data in   conjunction with additional information that reasonably links the   data to an identified or identifiable individual. The term does not   include deidentified data or publicly available information.          Sec. 121.002.  RULES.  The attorney general shall adopt   rules to implement this chapter.   SUBCHAPTER B.  DUTIES OF APP STORES          Sec. 121.021.  DUTY TO VERIFY AGE OF USER; AGE CATEGORIES.   (a) When an individual in this state creates an account with an app   store, the owner of the app store shall:                (1)  request the individual's age;                (2)  use a commercially reasonable method of   verification to verify the individual's age; and                (3)  assign to the individual a designation described   by Subsection (b).          (b)  The owner of an app store shall use the following age   categories for assigning a designation:                (1)  an individual who is younger than 13 years of age   is considered a "child";                (2)  an individual who is at least 13 years of age but   younger than 17 years of age is considered a "teenager";                (3)  an individual who is 17 years of age is considered   an "older teenager";                (4)  an individual who is at least 18 years of age but   younger than 21 years of age is considered an "adult"; and                (5)  an individual who is at least 21 years of age is   considered a "legal adult."          Sec. 121.022.  PARENTAL CONSENT REQUIRED. (a)  If the owner   of the app store determines under Section 121.021 that an   individual is a minor, the owner must obtain consent from the   minor's parent or guardian before allowing the minor to:                (1)  download a software application;                (2)  purchase a software application; or                (3)  make a purchase in or using a software   application.          (b)  The owner of an app store must obtain consent for each   individual download or purchase sought by the minor.          (c)  To obtain consent from a minor's parent or guardian   under Subsection (a), the owner of an app store may use any   reasonable means to:                (1)  disclose to the parent or guardian:                      (A)  the specific software application or   purchase for which consent is sought;                      (B)  the rating under Section 121.052 assigned to   the software application or purchase; and                      (C)  the specific content or other elements that   led to the rating assigned under Section 121.052;                (2)  give the parent or guardian a clear choice to give   or withhold consent for the download or purchase; and                (3)  ensure that the consent is given by an individual   that the owner of the app store has verified is an adult who is the   parent or guardian of the minor.          Sec. 121.023.  DISPLAY OF AGE RATING FOR SOFTWARE   APPLICATION. (a)  The owner of an app store that operates in this   state shall display for each software application available for   download and purchase on the app store:                (1)  the rating under Section 121.052 assigned to the   software application; and                (2)  the specific content or other elements that led to   the rating assigned under Section 121.052.          (b)  The information displayed under this section must be   clear, accurate, and conspicuous.          Sec. 121.024.  INFORMATION FOR SOFTWARE APPLICATION   DEVELOPERS. The owner of an app store that operates in this state   shall, consistent with the owner's data collection practices, allow   the developer of a software application to access current   information related to:                (1)  the age category assigned to each user under   Section 121.021(b); and                (2)  whether consent has been obtained for each minor   user under Section 121.022.          Sec. 121.025.  PARENT OVERSIGHT OF USAGE BY MINOR. The owner   of an app store that operates in this state, owns the operating   system of a mobile device, and provides parental controls to allow   users to enable certain content filters or limit software   application or mobile device usage shall take steps to make those   parental controls easy for a user to find and operate.          Sec. 121.026.  CONSTRUCTION OF SUBCHAPTER. Nothing in this   subchapter may be construed to:                (1)  prevent the owner of an app store that operates in   this state from taking reasonable measures to:                      (A)  block, detect, or prevent the distribution   of:                            (i)  obscene material, as that term is   defined by Section 43.21, Penal Code; or                            (ii)  other material that may be harmful to   minors;                      (B)  block or filter spam;                      (C)  prevent criminal activity; or                      (D)  protect the security of an app store or   software application;                (2)  require the owner of an app store that operates in   this state to disclose a user's personal data to the developer of a   software application except as provided by this subchapter; or                (3)  allow the owner of an app store that operates in   this state to use a measure required by this chapter in a manner   that is arbitrary, capricious, anticompetitive, or unlawful.   SUBCHAPTER C.  DUTIES OF SOFTWARE APPLICATION DEVELOPERS          Sec. 121.051.  APPLICABILITY OF SUBCHAPTER. This subchapter   applies only to the developer of a software application that the   developer makes available to users in this state through an app   store.          Sec. 121.052.  DESIGNATION OF AGE RATING. (a) The developer   of a software application shall assign to each software application   and to each purchase that can be made through the software   application an age rating based on the age categories described by   Section 121.021(b).          (b)  The developer of a software application shall provide to   each app store through which the developer makes the software   application available:                (1)  each rating assigned under Subsection (a); and                (2)  the specific content or other elements that led to   each rating provided under Subdivision (1).          Sec. 121.053.  CHANGES TO SOFTWARE APPLICATIONS. The   developer of a software application shall provide notice to each   app store through which the developer makes the software   application available before making any change to the terms of   service or privacy policy of the software application that:                (1)  affects or changes the rating assigned to the   software application under Section 121.052 or the content or   elements that led to that rating; or                (2)  materially changes the functionality or user   experience of the software application.          Sec. 121.054.  TIME RESTRICTION.  The developer of a   software application shall provide a readily available feature for   the parent or guardian of a minor to monitor and limit the amount of   time the minor spends using the application.          Sec. 121.055.  AGE VERIFICATION.  (a)  The developer of a   software application shall create and implement a system to verify:                (1)  for each user of the software application, the age   category assigned to that user under Section 121.021(b); and                (2)  for each minor user of the software application,   whether consent has been obtained under Section 121.022.          (b)  The developer of a software application shall use   information provided by the owner of an app store under Section   121.024 to perform the verification required by this section.   SUBCHAPTER D.  ENFORCEMENT          Sec. 121.101.  CIVIL PENALTY; INJUNCTION.  (a)  A person who   violates this chapter is liable to this state for a civil penalty in   an amount not to exceed:                (1)  $10,000; or                (2)  if the court finds that the person knowingly or   repeatedly violated this chapter, $20,000.          (b)  The attorney general may bring an action to:                (1)  collect the penalty under this section;                (2)  seek an injunction against further violation of   this chapter;                (3)  seek an order from the court for the person to   disgorge any money received in violation of this chapter; and                (4)  recover attorney's fees and reasonable court   costs.          Sec. 121.102.  PRIVATE CAUSE OF ACTION. (a)  The parent or   guardian of a minor who is a victim of a violation of this chapter   may bring an action against the owner of the app store or the   developer of a software application, as applicable.          (b)  A parent or guardian of a minor who prevails in an action   under this section is entitled to recover:                (1)  actual damages;                (2)  injunctive relief; and                (3)  attorney's fees and reasonable court costs.          SECTION 2.  (a) The attorney general shall adopt initial   rules to implement Chapter 121, Business & Commerce Code, as added   by this Act, not later than March 1, 2026.          (b)  An action under Chapter 121, Business & Commerce Code,   as added by this Act, may not be brought before March 1, 2027.          SECTION 3.  This Act takes effect September 1, 2025.