Press Release

Pair of Hertzberg Technology Bills Signed by Governor

Governor Brown approves bills to require bots to be labeled, and to incorporate blockchain into California business practices

September 28, 2018

SACRAMENTO – Senator Bob Hertzberg (D-Van Nuys) today announced that a pair of his bills to help government keep up with technology were signed by Governor Jerry Brown. SB 1001, the B.O.T Act of 2018 (Bolstering Online Transparency), will require automated online accounts, or bots, to be identified. SB 838 will authorize the use of blockchain technology for corporate share certificates in California.

The two bills were both key priorities of Senator Hertzberg this year, who introduced them in an effort to help modernize government, and to respond to and anticipate rapidly growing technology in the online realm. Their passage comes on the heels of the Governor signing AB 375 in June, a measure co-authored by Senator Hertzberg that goes further than any law in the country to protect California consumers and their private information online.

SB 1001 was introduced with the support of Common Sense Kids Action to address the growing occurrence of automated bots masquerading as individuals and being weaponized to spread fake and misleading news with a goal of lending false credibility and reshaping political debates.

“Social media has become an integral part of our day to day lives,” said Senator Hertzberg. “People have the right to know if the information they read online is actually someone trying to deceive them.”

James P. Steyer, Founder and CEO of Common Sense, added, “The BOT Act is a step in the right direction to bring transparency to social media but there is a lot more work to do to ensure consumers — including kids — understand who is behind the messages they are seeing on social media sites like Twitter. The country needs to have a national discussion about the impact of social media and digital tools on our democracy to ensure we craft stronger legislation that addresses this serious problem – and that we can hold accountable individuals and platforms who would use digital platforms and tools to undermine our democracy."

SB 838, on the other hand, looks forward to blockchain, an emerging technology that could help protect California businesses and consumers.

California corporations currently provide share certificates to their stockholders to demonstrate the issuance or transfer of stock. This method is time consuming and open to potential cases of fraud. SB 838 will enable California corporations to also issue and transfer corporate share certificates via the blockchain – a method widely considered to be a vastly more secure way of doing business.

“For once, government is catching up to a rapidly growing technology,” said Senator Hertzberg. “California has always been a place for innovation and opportunity, and SB 838 shows how we can use technology to increase consumer protection and help prevent cases of fraud.”

Blockchain allows records to be more securely stored and updated on multiple computers using a distributed ledger technology. While blockchain is commonly seen as the “wallet” for cryptocurrencies, it also represents what the future of the financial industry, government contracts, stock certificates and more could look like. It is currently being considered for everything from the sale of bonds in Berkeley, California to secure voting systems for service members in Denver, Colorado.

SB 838 was signed alongside AB 2658, another piece of blockchain legislation that Senator Hertzberg co-authored with Assembly Majority Leader Ian Calderon (D-Whittier). AB 2658 defines blockchain under law and establishes a blockchain working group to report to the Legislature on the potential uses, risks, and benefits of the use of blockchain technology – effectively offering a study of the implementation of SB 838.

The bill received widespread acclaim from the blockchain and cryptocurrency industries, and passed both the Senate and Assembly without a single “No” vote.

Media Contact: Katie Hanzlik
Katie.Hanzlik@sen.ca.gov
Press Secretary
Senator Robert M. Hertzberg
Capitol Building, Room 4038
(916) 651-4018

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