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<ns0:Id>20250SB__107497AMD</ns0:Id>
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<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-13</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Senator Wiener</ns0:AuthorText>
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<ns0:Legislator>
<ns0:Contribution>LEAD_AUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Wiener</ns0:Name>
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<ns0:Title> An act to add Chapter 2.6 (commencing with Section 16850) to Part 2 of Division 7 of the Business and Professions Code, relating to business.</ns0:Title>
<ns0:RelatingClause>business</ns0:RelatingClause>
<ns0:GeneralSubject>
<ns0:Subject>Covered provider: goods and services: self-preferencing conduct.</ns0:Subject>
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<html:p>Existing law, known as the Cartwright Act, defines a “trust” as a combination of capital, skill, or acts by 2 or more persons for certain prohibited purposes, including, among others, creating or carrying out restrictions in trade or commerce, preventing competition in specified activities, including sale or purchase of merchandise or commodities, or entering into certain exclusive dealing agreements that substantially lessen competition or tend to create a monopoly. Existing law authorizes the Attorney General, a district attorney, a specified city attorney, or a person who is injured in their business or property to bring an action for civil or criminal penalties for a violation of those provisions.</html:p>
<html:p>This bill would prohibit a covered provider, as defined, from preferencing its own products, services, or lines of business over those of
another business user, including manipulating the order of search results or rankings to favor the products or services of the covered provider. The bill would prohibit a covered provider from restricting interoperability or data portability, as specified, including restricting a business user or consumer from obtaining a copy of their data in a useful and portable format.</html:p>
<html:p>This bill would declare that its remedies and penalties are cumulative and enforceable in addition to other specified remedies, and would provide an affirmative defense for certain conduct. The bill would exempt from these provisions displays of objective content, including mathematical calculations and standard unit conversions, under certain conditions. The bill would specify that its provisions are enforceable by the same means, penalties, damages, and fees as under the Cartwright Act, thereby expanding the scope of existing crimes. The bill would declare its provisions severable.</html:p>
<html:p>The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.</html:p>
<html:p>This bill would provide that no reimbursement is required by this act for a specified reason.</html:p>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
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<ns0:Num>SECTION 1.</ns0:Num>
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Chapter 2.6 (commencing with Section 16850) is added to Part 2 of Division 7 of the
<ns0:DocName>Business and Professions Code</ns0:DocName>
, to read:
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<ns0:LawHeading id="id_76D52554-1F49-4544-964E-7E9AF3BE62FA" type="CHAPTER">
<ns0:Num>2.6.</ns0:Num>
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<ns0:LawHeadingText>Self-Preferencing Online Platforms</ns0:LawHeadingText>
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<ns0:Num>16850.</ns0:Num>
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<html:p>For purposes of this chapter, all of the following definitions apply:</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
“Artificial intelligence” means an engineered or machine-based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
“Business user” means a person or entity that uses a covered platform for the purpose of connecting with consumers or other business users to provide products or
services, including a person for whom a covered platform provides access to users or customers.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
“Nonpublic business user data” means data generated by the activities of a business user on a covered platform that is not
made publicly available by the covered platform to all similarly situated business users on equivalent terms.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
“Consumer” means a natural person who uses a covered platform for purposes other than as a business user.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
“Covered platform” means a digital interface that allows business users or sellers to connect with consumers or other business users in the state and that meets both of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The platform, at any time in the last 24 months, had an average of 100,000,000 or more monthly active users in the United States.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The
platform meets either of the following:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
At any point prior to January 1, 2030, it is owned, controlled, or operated by an entity or person that in the last 24 months has had an average of one trillion dollars ($1,000,000,000,000) or greater in market capitalization.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
At any point on or after January 1, 2030, it is owned, controlled, or operated by an entity or person that in the last 24 months has had an average of one trillion dollars ($1,000,000,000,000) or greater in market capitalization or private valuation.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
“Covered provider” means a person or entity that owns, controls, or operates a covered platform.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
“Most Favored Nation Clause” means a clause in a contract that gives a party to the contract the legal right to terms and benefits under the contract that are as good as or more favorable than the terms and benefits received by anyone else who enters into a similar contract with the other party.
</html:p>
<html:p>
(h)
<html:span class="EnSpace"/>
“Self-preferencing conduct” means a practice by which a covered provider treats its own products, services, lines of business, or content more favorably than comparable products, services, or content of a business user, whether implemented through ranking, display, algorithmic recommendation, technical access conditions, integration depth, default status, or any other means of determining the relative visibility, accessibility, or prominence of products, services, or content on or
through the covered platform.
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<ns0:LawSection id="id_C276F78D-E8B5-4C1D-8564-29C876EC7071">
<ns0:Num>16851.</ns0:Num>
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<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
A covered provider shall not engage in self-preferencing conduct. Prohibited self-preferencing conduct under this subdivision includes, but is not limited to, all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Manipulating
the order of search results or rankings to favor the products or services of the covered provider.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Exploiting transaction data or nonpublic proprietary data collected from a third-party seller to market or develop the products of the covered provider.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Employing policies or practices that cause a business user to operate at an unreasonable cost disadvantage relative to the covered provider.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Favoring a company on the platform based on the profit margin returned to the covered provider.
</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
Conditioning platform access or preferred status or placement on the covered platform on the purchase or use of other products or services offered by the covered provider, where a materially less restrictive means of achieving any legitimate integration objective is available.
</html:p>
<html:p>
(6)
<html:span class="EnSpace"/>
Requiring most favored nation clauses or margin guarantees that restrict the ability of a business user to set their own prices.
</html:p>
<html:p>
(7)
<html:span class="EnSpace"/>
Providing an agent or third-party service financed in a manner that creates a conflict of interest between the user and the covered provider.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
A covered provider shall not restrict the independence or interoperability of business users and consumers on the platform. Prohibited
conduct under this subdivision includes, but is not limited to, all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Restrict, impede, or unreasonably delay a business user from interoperating with the same platform features, operating systems, or hardware available to the covered provider’s own lines of business.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Restrict a business user or consumer from obtaining a copy of their data in a useful and portable format.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Restrict a consumer from voluntarily providing data through a covered platform to a third party.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
(A)
<html:span class="EnSpace"/>
Design, deploy, or utilize artificial intelligence in a manner that systematically favors the products, services, content, or commercial
partners of the covered platform over those of third parties.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The use of artificial intelligence as described in subparagraph (A) includes a generative artificial intelligence summary, recommendation engine, conversational agent, or shopping assistant.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
Subparagraph (A) shall not apply if the covered platform demonstrates that it consistently applies a neutral methodology to both its own and third-party content and that any differential treatment results solely from that neutral methodology and not from the commercial interests of the covered platform.
</html:p>
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<ns0:LawSection id="id_58E2736C-08EA-4B7B-9CAC-494DABE85BB3">
<ns0:Num>16852.</ns0:Num>
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<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
In any action brought to enforce this chapter, it shall be an affirmative defense if the defendant establishes both of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The alleged conduct was narrowly tailored, nonpretextual, and reasonably necessary to achieve a procompetitive purpose.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The procompetitive justifications and actual effects of the conduct clearly outweigh the competitive harms in the same market.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
This chapter shall not be construed to prohibit a covered platform from displaying objective information that is susceptible to a singular result, including
mathematical calculations, the current time, standard unit conversions, and publicly available, contemporaneous data feeds that are displayed without the exercise of editorial judgment, if both of the following conditions are met:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The display does not systematically displace a competitive market for the provision of that information.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The covered platform does not apply differential treatment to comparable information provided by a third party.
</html:p>
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</ns0:LawSection>
<ns0:LawSection id="id_1B9C9E4A-A050-4529-B1BB-95BAEDA7AC54">
<ns0:Num>16853.</ns0:Num>
<ns0:LawSectionVersion id="id_AAD03013-B982-433F-ADD4-4F35E690BFC4">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
An action to enforce this chapter may be brought by any person, entity, or public officer authorized to bring an action under the Cartwright Act (Chapter 2 (commencing with Section 16700)).
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
A covered provider that violates this chapter shall be liable for the same penalties, damages, and fees as those provided in the Cartwright Act (Chapter 2 (commencing with Section 16700)).
</html:p>
</ns0:Content>
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</ns0:LawSection>
<ns0:LawSection id="id_08C3103C-5624-4AE4-BC8D-97146CE5AB2F">
<ns0:Num>16854.</ns0:Num>
<ns0:LawSectionVersion id="id_5A84346E-3A34-465C-ADEC-2244083C09BE">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
The remedies and penalties provided by this chapter are cumulative to each other and to the remedies or penalties available under all other laws of this state, including, but not limited to, the Cartwright Act (Chapter 2 (commencing with Section 16700)), the Unfair Practices Act (Chapter 4 (commencing with Section 17000)), and the Unfair Competition Law (Chapter 5 (commencing with Section 17200)).
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The provisions of this chapter are severable. If any provision of this chapter or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
</html:p>
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<ns0:Num>SEC. 2.</ns0:Num>
<ns0:Content>
<html:p>
No reimbursement is required by this act pursuant to Section 6 of Article XIII
<html:span class="ThinSpace"/>
B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII
<html:span class="ThinSpace"/>
B of the California Constitution.
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