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Cybersecurity Bill Cannot Add Regulation, Threats To U.S. Businesses

October 23, 2012
Bloomberg BNA
David Hansen

Firms that share cybersecurity information with the federal government should be given immunity from related civil actions, Department of Defense Secretary Leon Panetta said in an Oct. 11 speech to members of the group Business Executives for National Security (BENS).

A cooperative relationship with the private sector is critical for enhancing cybersecurity, he said.

Panetta's comments did not placate some private industry groups, which told BNA they continue to approach federal cybersecurity initiatives with wariness due to fears about increased regulation.

In his speech, Panetta said businesses should welcome, rather than fear, new cybersecurity rules.

“Ultimately, no one has a greater interest in cybersecurity than the businesses that depend on a safe, secure, and resilient global, digital infrastructure, particularly those who operate the critical networks that we must help defend,” he told BENS members as he accepted an award from the group for his efforts to improve national security.

“Companies should be able to share specific threat information with the government without the prospect of lawsuits hanging over their head.”  

“To defend those networks more effectively, we must share information between the government and the private sector about threats in cyberspace,” Panetta said. “Companies should be able to share specific threat information with the government without the prospect of lawsuits hanging over their head.”

Building stronger partnerships with the private sector is among the top cybersecurity goals of DOD, Panetta said. Along with information sharing, he said, DOD must work with the business community to develop standards to protect critical private-sector infrastructure such as power plants, water treatment plants, and gas pipelines.

“This would help ensure that companies take proactive measures to secure themselves against sophisticated threats, but also take common-sense steps against basic threats,” Panetta said. “Although awareness is growing, the reality is that too few companies have invested in even basic cybersecurity.”

In his remarks, Panetta called on Congress to pass a comprehensive cybersecurity bill such as the Cybersecurity Act of 2012 (S. 3414). Before the Senate adjourned for its August recess, the bill failed to garner the 60 votes necessary to invoke cloture and bring it to a vote (11 PVLR 1227, 8/6/12).

“Businesses … need certainty that threat and vulnerability information voluntarily shared with the government will not lead to frivolous lawsuits, will not be publicly disclosed, and will not be used to regulate other activities. The optimal way forward will not be found in layering additional regulations on the business community.”  

“This legislation has bipartisan support, but is victim to legislative and political gridlock like so much else in Washington,” he said. “That frankly is unacceptable, and it should be unacceptable not just to me, but to you, and to anyone concerned with safeguarding our national security.”

President Obama is considering an executive order on cybersecurity if Congress fails to act, but it will not be an adequate substitute for comprehensive legislation, Panetta said.

“The fact is that to fully provide the necessary protection in our democracy, cybersecurity legislation must be passed by the Congress. Without it, we are and we will be vulnerable.”

Private Industry Concerned but Opposes Bill.

Republicans and business groups such as the U.S. Chamber of Commerce opposed S. 3414 because of concerns that it mandated cybersecurity standards for private industry (11 PVLR 1229, 8/6/12).

The U.S. Chamber of Commerce Oct. 12 said it did not dispute the need for cybersecurity legislation to protect against cyber-attacks. But a bill adding layers of new rules on top of existing ones will not succeed, the group's Vice President of National Security and Emergency Preparedness, Ann Beauchesne, said.

“We will continue to support legislation that will spur the sharing of cyber threat information between government and the business community,” she told BNA. “Businesses also need certainty that threat and vulnerability information voluntarily shared with the government will not lead to frivolous lawsuits, will not be publicly disclosed, and will not be used to regulate other activities. The optimal way forward will not be found in layering additional regulations on the business community.”

The National Association of Manufacturers (NAM) shares Panetta's concerns about cybersecurity, NAM Director of Technology Policy Brian Raymond said in an Oct. 12 statement provided to BNA. He reiterated Beauchesne's position that one of the best ways to accomplish this is for industry and government to share information on cyberthreats in a timely manner.

“This needs to happen without creating uncertainty and new and unnecessary regulations on manufacturers, and it needs to happen now,” Raymond said. “A heavy-handed regulatory approach, either by legislation or an executive order, will not increase our nation's cybersecurity.”

Panetta cited two other tracks DOD is taking to defend the nation's cybersecurity.

The department is developing new capabilities to stop cyber-attacks, he said. Specifically, DOD is investing in sensors to hunt down malicious code before it attacks domestic systems, and has improved its ability to identify those responsible for attacks and take action against them.

DOD also is organizing policies across federal agencies to defend against cyber-attacks. To that end, it is finalizing “the most comprehensive change to our rules of engagement in cyberspace in seven years,” Panetta said.

The new rules will clarify that DOD defends its own networks--and national networks as well. In addition, the department is developing a common real-time understanding of cyberthreats to share with other agencies.

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