Companies trading online in California could soon be forced by law to give consumers the right not to be tracked across the web.

State politicians Tuesday voted to move forward a proposed bill that would see California's top law enforcement officials draw up rules protecting shoppers' online privacy by July 1 2012.

California's Senate Judiciary Committee voted to move the bill, SB 761 introduced by Democrat senator Alan Lowenthal, to its next stage in the ratification process.

The bill would order web sites based in California and dealing with California residents to give shoppers the right to not have their online activity tracked, stored or sold to others. Sites that fail to do so would become liable to prosecution by consumers through a civil action.

If approved, SB 761 would require the state's Attorney General to have adopted regulations governing opt-out and privacy no later than July 1, 2012.

California stands to become the first US state to pass do-not-track legislation and is poised to beat any national law. The Do Not Track Me Online Act was only introduced to the US House of Representatives in Washington DC in February – that was by another Californian Democrat, Jackie Speier – and must navigate Capitol Hill's partisan log jam.

SB 761 is reported to have already drawn opposition from one technology pressure group, twitchy about politicians spoiling the consumer data garage sale that's in full swing across Silicon Valley service providers and their technology enablers. A spokesperson for TechNet whose members include Silicon-Valley-based Apple, Cisco Systems, eBay, Google, Salesforce.com and Yahoo! along with Microsoft and Dell among others called SB 761 a job killer, that would hurt companies that use an advertising based economic model to survive.

Consumer pressure group Consumer Watchdog, which is championing SB 761, pointed out in a statement that under SB 761 web sites with which a consumer has an ongoing business relationship could gather information necessary for transactions even if the consumer had enabled Do Not Track.

SB 761 is meant to buttress moves by browser manufacturers Apple, Microsoft, Mozilla and Google that are implementing do-not-track in their browsers.

They have come quickly after the US Federal Trade Commission (FTC) last year gave its considered opinion that it's worried about the state of consumer privacy on the web.

The FTC said industry attempts at self-regulation were moving too slowly and it offered its own framework and recommendations to protect privacy and control sharing of consumers' data. Among the proposals: a do-not-track mechanism with a simple opt-out procedure.

Mozilla has proposed using an HTTP header that can – when activated – tell web sites not to track users of Firefox. Microsoft offered the option of creating lists of blocked sites in Internet Explorer 9 while leaving the way open for an header approach in IE. Apple is reported to be going the way of an HTTP header in the next version of Safari.

Google, whose entire business is predicated on online advertising, has taken the approach in Chrome of letting you opt out of tacking cookies from multiple advertising networks.

Consumer Watchdog said in its statement that the problem with do-not-track at the browser level is that there's no requirement on the web site to honor the do-not-track request. ®