Chapter 22.8 of the California Business and Professions Code imposes requirements on social media companies with annual gross revenues of $100 million or more to submit “terms of service reports” to the California Attorney General, with the first report due by January 1, 2024. The statute is currently the subject of a constitutional challenge, but covered companies should not delay preparing reports in case the lawsuit drags on or is unsuccessful.

The law applies to owners or operators of “social media platforms”, which include any public or semipublic online service that meets all of the following criteria:

  1. The service has users in California;
  2. A substantial function of the service is to connect users so that they can interact socially with one another on the service; and
  3. The service enables a user to construct a public or semipublic profile as part of their account, populate a list of other users with whom they share a social connection in the system, and create content viewable by other users.

The above criteria call to mind social networking platforms, multiplayer video games, virtual hangout spaces, dating apps, discussion boards, and online marketplaces or streaming platforms that offer a social component with users in California. The law defines “social media company” to mean any entity that owns or operates a social media platform.

Covered social media companies must submit a report that includes the following for each social media platform that the company owns or operates:

1. The current version of the platform’s terms of service.

2. A complete and detailed description of any changes to the terms of service since the company’s previous report. This item is therefore not necessary for the first report regarding any given social media platform.

3. A statement of whether the current version of the terms of service defines each of the following categories of content, and, if so, the definitions of those categories, including any subcategories (collectively, the “Covered Content Categories”): (A) Hate speech or racism; (B) Extremism or radicalization; (C) Disinformation or misinformation; (D) Harassment; and (E) Foreign political interference.

4. A detailed description of the company’s content moderation practices for that platform, including the following:

  • (A) Any existing policies intended to address the Covered Content Categories;
  • (B) How automated content moderation systems enforce the platform’s terms of service and when these systems involve human review;
  • (C) How the company responds to user reports of violations of the terms of service;
  • (D) How the company removes individual pieces of content, users, or groups that violate the terms of service, or takes broader action against individual users or against groups of users that violate the terms of service;
  • (E) The languages in which the social media platform does not make terms of service available, but does offer product features, including, but not limited to, menus and prompts;

5. The details described at (A) below, disaggregated into the categories at (B) below.

  • (A) Information on content that the company flagged as content belonging to any of the Covered Content Categories, including all of the following:
    • i. The total number of flagged items of content;
    • ii. The total number of actioned items of content (“actioned” means that the company took some form of action due to a suspected or confirmed violation of the terms of service, such as removal, demonetization, deprioritization or banning of the relevant user or content);
    • iii. The total number of actioned items of content that resulted in the company taking action against the user or group of users responsible for the content.
    • iv. The total number of actioned items of content that the company removed, demonetized, or deprioritized.
    • v. The number of times actioned items of content were viewed by users.
    • vi. The number of times actioned items of content were shared, and the number of users that viewed the content before it was actioned.
    • vii. The number of times users appealed the company’s actions taken on that platform and the number of reversals of company actions on appeal, disaggregated by each type of action.
  • (B) The information listed under (A) above must be disaggregated into the following categories:
    • i. The category of content, including any relevant Covered Content Categories.
    • ii. The type of content, such as posts, comments, messages, profiles of users, or groups of users.
    • iii. The type of media of the content, such as text, images, and videos.
    • iv. How the content was flagged, such as whether the content was flagged by company employees or contractors, AI software, community moderators, civil society partners, or users.
    • v. How the content was actioned, such as whether the content was actioned by company employees or contractors, AI software, community moderators, civil society partners, or users.

If a social media company had gross revenues of $100 million or more in 2022, it must submit reports on the following dates covering on-platform activity during the following time periods:

  • By January 1, 2024, the company must submit a report covering activity on each of its social media platforms during Quarter 3 of 2023.
  • By April 1, 2024, the company must submit a report covering activity on each of its social media platforms during Quarter 4 of 2023.
  • By October 1, 2024, the company must submit a report covering activity on each of its social media platforms during Quarters 1 and 2 of 2024.
  • By April 1 of each subsequent year, the company must submit a report covering activity on each of its social media platforms during Quarters 3 and 4 of the preceding year.
  • By October 1 of each subsequent year, the company must submit a report covering activity on each of its social media platforms during Quarters 1 and 2 of that year.

The California Attorney General’s website contains a webpage that includes a portal through which companies may submit reports, and a publicly accessible repository of terms of service reports that companies have already submitted (which is empty as of December 1, 2023). Failure to comply with requirements to submit terms of service reports or ensure their completeness and accuracy can result in civil penalties of up to $15,000 per violation per day.

In addition, Chapter 22.8 of the California Business and Professions Code requires covered social media companies to conspicuously post terms of service that include the following:

  1. Contact information for the purpose of allowing users to ask the company questions about the terms of service;
  2. A description of the process that users must follow to flag content, groups, or other users that they believe violate the terms of service, and the company’s commitments on response and resolution time; and
  3. A list of potential actions the company may take against an item of content or a user, including, but not limited to, removal, demonetization, deprioritization, or banning.

The statute also essentially requires that such terms of service be translated into all languages in which the social media platform offers products features. Violations of these requirements may separately be subject to civil penalties of up to $15,000 per day.