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Infrastructure Cybersecurity: Carrots And Sticks

As lawmakers and private industry leaders wrangle over how to best protect our nation's critical infrastructure from cyberattack, existing anti-terror legislation could offer a promising start.
But there is a way for firms to potentially participate in the executive order's cybersecurity framework and shield themselves from liability through existing legislation. This protection comes through the Support Anti-Terrorism by Fostering Effective Technologies Act (SAFETY Act). Part of the Homeland Security Act of 2002, the SAFETY Act is intended to promote developing and deploying anti-terrorism technologies by creating systems of "risk" and "litigation management." The law covers technologies such as products, devices, equipment, services, cyber-related items such as information technologies and networks and integrated systems.

The legislation applies to an "act of terrorism" that may include cyber terrorism. Among other things, the SAFETY Act uses the DHS definition of a terrorist act as an unlawful activity that causes harm, including financial damage, to a person, property, or entity in the United States or U.S. people or organizations overseas, explained Dismas Locaria, a Venable partner specializing in government contracts and homeland security issues.

Locaria notes that the SAFETY Act provides organizations with three levels of protection: certification; designation; and developmental, testing and evaluation designation (DTED). Certification offers the highest level of confidence, designation refers to systems that are proven to be effective, and DTED status is for technologies that require additional evidence to prove their effectiveness.

The SAFETY Act offers organizations with significant benefits; for example, certification status offers immunity from third-party liability as the result of a terrorist attack. Designation status provides a variety of protections: a predetermined cap on insurance premiums related to terrorist activities, exclusive jurisdiction in federal court, claims consolidation, no joint and several liability for noneconomic damages, a bar on noneconomic damages unless the plaintiff suffers physical harm, no punitive damages and prejudgment interest, and plaintiff's recovery is reduced by collateral sources. DTED also has the same benefits as designation, but for only three years, Locaria added.

Firms can get protection under the Act by conducting an internal technology assessment and submitting an application to the DHS's Office of Safety Act Implementation (OSAI). The firms are then reviewed for compliance -- a process that takes about four months -- before the DHS either approves or rejects the application. Although it is not a panacea, Locaria said that the law is an additional tool for companies to use when assessing their vulnerability to cyber attack.

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