Category: Countries
28. April 2023
Montana and Tennessee have both passed comprehensive bills in their state legislatures on April 21st, making them the latest additions to the states that have enacted privacy laws this year, alongside Indiana and Iowa.
Iowa Data Privacy Act (IDPA)
Iowa joined Connecticut, Utah, Virginia, Colorado, and California on March 29th as the sixth state to approve a comprehensive privacy law. The law will become effective on January 1st, 2025, which provides organizations with 21 months to meet the new requirements. Even though the law shares several similarities with other state privacy laws, organizations need to pay attention to a few distinctions as they broaden their compliance efforts across the United States.
The Iowa Data Privacy Act (IDPA) applies to businesses that operate in Iowa or target products or services to Iowa consumers and control or process personal data of 100,000 or more Iowa consumers or 25,000 or more Iowa consumers and derive over 50% of gross revenue from the sale of that data. The IDPA’s definition of a “consumer” includes natural persons who are Iowa residents acting in a personal (noncommercial and nonemployment) context, and excludes employees and B2B contacts. The IDPA imposes obligations on data controllers, such as limiting the purpose of processing personal data, implementing reasonable safeguards, refraining from discrimination, being transparent in their privacy notice, and ensuring contracts control relationships with their processors. It provides Iowa consumers with opt-out, deletion, access, appeal, and data portability rights. Sensitive personal information includes racial/ethnic origin, religious beliefs, and geolocation data, among others, and controllers must provide clear notice and an opportunity to opt-out of nonexempt processing.
The Iowa Attorney General has exclusive enforcement authority, and the IDPA does not allow for a private right of action.
Indiana Bill on Consumer data protection
Indiana is set to become the seventh state to enact a comprehensive privacy law when Senate Bill No. 5 is signed by Governor Eric Holcomb. The law goes into effect on January 1, 2026.
The Indiana privacy law applies to businesses that process the personal data of at least 100,000 Indiana residents or 25,000 Indiana residents and generate more than 50% of their gross revenue from the sale of personal data. Certain entities and data are exempt from the law. The law requires businesses to provide consumers with a clear and meaningful privacy notice and gives consumers the right to confirm, access, correct, delete, and port their personal data. Consumers can also opt-out of the processing of their personal data for targeted advertising, sale of personal data, or profiling that produces significant effects. There is no private right of action, and businesses have a 30-day cure period for any alleged violations. The Indiana privacy law is similar to other comprehensive state privacy laws, such as the Virginia Consumer Data Protection Act.
Montana Consumer Data Privacy Act (MCDPA)
After passing both houses of the Montana legislature, the Montana Consumer Data Privacy Act (MCDPA) now awaits Governor Greg Gianforte’s signature. The MCDPA is similar to the laws in Connecticut and Virginia, suggesting that these models are becoming the foundation for other state privacy laws concerning consumers.
The Montana Consumer Data Privacy Act (MCDPA) applies to companies that do business in Montana, control or process personal data of 50,000 or more Montana consumers or 25,000 or more Montana consumers and derive over 25% of gross revenue from the sale of that data. “Consumer” is defined as a natural person who is a resident of Montana acting in a personal context. Personal data includes information that is linked or reasonably linkable to an identified or identifiable individual. Sensitive data includes information about a person’s race/ethnic origin, religion, health diagnosis, sex life, sexual orientation, citizenship, immigration status, and genetic or biometric information. Companies must provide a standard set of consumer rights, including opt-out rights related to the sale of personal data, deletion rights, access rights, correction rights, appeal rights, opt-in rights for advertising and targeted marketing to individuals aged 13 to 16, and data portability rights. Sensitive data cannot be processed without obtaining the consumer’s consent or, in the case of a child, complying with COPPA. The MCDPA requires controllers to limit the purpose of processing personal data to that which is reasonably necessary and proportional, take steps to implement reasonable safeguards for the personal data within their control, refrain from discriminating against consumers for exercising their rights, and be transparent in their privacy notice.
The Montana Attorney General has exclusive enforcement authority, and there is no private right of action. The MCDPA will go into effect on October 1, 2024.
Tennessee Information Privacy Act (TIPA)
If Governor Bill Lee approves, Tennessee will soon join the states with comprehensive privacy laws with the implementation of the Tennessee Information Privacy Act (TIPA). The TIPA largely follows the model of California’s CCPA, but with one notable exception.
TIPA applies to companies doing business in or targeting products or services to Tennessee residents, and processing personal information of at least 100,000 consumers, or 25,000 consumers and deriving more than 50% of their gross revenues from the sale of personal information. Compliance with CCPA obligations will likely result in compliance with TIPA, subject to obligations with respect to the NIST Privacy Framework. The NIST Privacy Framework requires companies to identify, govern, control, communicate and protect privacy risks. Failure to comply with TIPA may result in penalties of up to $15,000 per violation, enforced by the Tennessee Attorney General.
Outlook
Several states are currently working on passing their own comprehensive consumer privacy bills this year, and there are also plans for more specialized privacy laws. For example, there are proposed laws focused on children, social media (such as Utah’s Social Media Regulation Act), and health information not covered by HIPAA (such as Washington’s My Health My Data Act). In addition, there is also the draft legislation for a comprehensive data protection law at the federal level.
3. March 2023
The lack of comprehensive federal privacy legislation in the United States continues to be a cause of concern for many, as consumers and industry struggle with the growing patchwork of state laws. With the rise of data breaches, hacking, and other cyber threats, individuals are rightly concerned about the security and privacy of their personal information. As a result, lawmakers in the United States have introduced several data protection bills that could get a second look in Congress.
Several data protection bills
The “Health Data Use and Privacy Commission Act”, sponsored by Senator Bill Cassidy, aims to establish a blue-ribbon panel to recommend changes to health privacy laws. This bill seeks to address the growing concerns about the collection, use, and dissemination of personal health data. The panel would be tasked with evaluating current laws and regulations, identifying gaps and weaknesses, and recommending changes to ensure that individuals’ health data is adequately protected.
The “My Body, My Data Act” would create a new national standard to protect personal reproductive health data. By minimizing the personal reproductive health data that is collected and retained, the bill would prevent this information from being disclosed or misused.
The “Data Care Act” would require websites, apps, and other online providers to take responsible steps to safeguard personal information and stop the misuse of users’ data. This bill seeks to hold companies accountable for their data practices and prevent them from using personal data in ways that could lead to harm. It would require companies to take reasonable steps to safeguard personal data and to disclose how they use and share consumer data.
A national data protection framework remains the main goal
The “American Data Privacy and Protection Act” (ADPPA) was proposed last year, and while it failed to make it to the House floor, it remains the preferred framework for addressing current regulatory shortcomings. The latest Congressional hearing dedicated to privacy, hosted by the House Committee on Energy and Commerce’s new Subcommittee on Innovation, Data and Commerce, discussed the need for comprehensive federal legislation and confirmed that the ADPPA is the only framework being considered at this time.
The hearing also highlighted the industry benefits of a national standard, particularly for small and medium-sized businesses, who are struggling to keep up with the growing state privacy law patchwork. Federal preemption remains a point of contention in ADPPA talks, with several states rejecting proposed preemption last year, most notably California.
The subcommittee also focused on the need to regulate the growing data broker industry, which was characterized as a “multibillion-dollar economy selling consumers’ data with virtually no restrictions or oversight.” The ADPPA carries important provisions on broker disclosure and user opt-out obligations, which are designed to increase transparency and give consumers greater control over their data.
Outlook
The lack of comprehensive federal privacy legislation in the United States continues to be a concern for consumers and industry. As technology continues to advance and new threats emerge, it is essential that lawmakers in the United States take proactive steps to ensure that individuals’ rights to privacy are protected. By passing these bills, Congress can help to establish a framework for data protection that will safeguard individuals’ personal information and prevent abuses of data use. Until now, data protection in the United States has primarily been at the top of the agenda at the state level. California, Colorado, Connecticut, Virginia, and Utah have recently enacted comprehensive data privacy laws. The ADPPA remains the preferred framework for addressing current regulatory incompletion, and there are growing calls for a national standard to avoid the problems that arise with a growing state privacy law patchwork. While federal preemption remains a point of contention, there are hopes that new Republican leadership could bring better odds of the ADPPA making it to the floor in 2023.
10. January 2023
In the first week of January 2023, the Federal Communications Commission voted on a Proposed Rulemaking, which was passed with 4 votes in favour against none opposed, in order to strengthen the Commission’s rules for notifying customers and federal law enforcement agencies of breaches of customary proprietary network information.
The proposition was made after the wave of new legislations regarding the right to privacy and personal data protection both on a State and a federal level across the U.S.
One of the most relevant proposals contained in the document is to eliminate the current mandatory seven day waiting period for notifying customers of a data breach.
The FCCs Chairman, Jessica Rosenworcel, stated that the rules which were applied until now need to be updated. The FCC will open a formal phase in order to gather more information on how to implement the proposed changes and will also take into account comments made by the FCC Board.
12. October 2022
A few days ago a Dutch court ordered a Florida – based company to pay a compensation of 75.000 Euros to an employee. The employee had been fired because he had refused to keep his work computer’s camera on the whole day, as required by the company, being concerned with the fact that this was an invasion of his privacy.
After he was fired he took his former employer to court, suing for wrongful termination; the judges recognized the issue and stated that the American company’s regulation was a violation of the employee’s privacy and were in violation of data protection laws. The worker had already stated his complaint with his employer, also stating that they already could see his shared screen while he was working, and that it was not necessary for him to keep the camera on.
Rather than a matter of personal data protection, this was a matter of the employee’s right to privacy, as stated in Article 8 of the European Convention of Human Rights: the court argued that the company’s request was disproportionate and intrusive of the worker’s privacy.
According to Dutch law, an appeal is possible for the company within three months of the ruling. In the aftermath of the ruling, the company shut down its offices in Rijswijk, Netherlands, where the plaintiff worked.
Lately, the Chinese social media success has been the subject of an investigation by the British data protection watchdog, the Information Commissioner’s Office (ICO): the investigation has so far concluded that the social media network has clearly breached the United Kingdom’s data protection laws, in particular the regulations concerning children’s personal data in the time. The Authority issued therefore a notice of intent, which is a potential precursor to a fine amounting up to a staggering 27 million pounds.
In particular, the Authority found out that the platform could have processed personal data of children under the age of 13 failing to gather the parents’ consent for the processing of these data. Under these data there are allegedly also special category data, which have a special protection under Art. 9 GDPR.
Furthermore, in the ICO’s opinion the principle of transparency was not respected by the Chinese hit platform by not providing complete or transparent information on the data processing or their gathering.
The ICO’s investigation is still ongoing as the Commissioner’s Office is still deciding whether to impose the fine or whether there has been a breach of data protection law.
The protection of teenagers and children is the top priority of the ICO according to current Information Commissioner John Edwards. Under his guidance, the ICO has several ongoing investigations targeting various tech companies who could be breaking the UK’s data protection laws.
This is not the first time TikTok has been under observation by data protection watchdogs. In July a US – Australian cybersecurity firm has found that TikTok gathers excessive amounts of information from their users, and voiced their concern over their findings. Based on these precedents, it could be possible that local data protection authorities will increment their efforts to control TikTok’s compliance with local laws and, in Europe, with the GDPR.
23. August 2022
At the end of June 2022, the United States Supreme Court overturned its 1973 ruling in the case of Roe vs. Wade, thus concretely ending federal abortion rights. The decision caused a worldwide outrage, but now a concerning situation presents itself: the massive use of social media and the Internet by the population could result in serious personal privacy violations by the authorities. For example, tech giants such as Apple, Google and Meta Inc. could share users’ data if law enforcement authorities suspect a felony is being committed. This could especially be the case in those States who chose to make abortion illegal after the Supreme Court’s ruling. According to the United States’ Federal Rules of Civil Procedure no. 45, this kind of personal data could be made object of a subpoena, thus forcing the subject to produce them in court. In such a scenario tech companies would have no choice than to provide the consumer’s data. It is clear that this is a high risk for the consumer’s privacy.
In particular, location data could show if a person visited an abortion clinic. Many women use specific apps in order to track periods, fertility and an eventual pregnancy. All these data could be put under surveillance and seized by law enforcement in order to investigate and prosecute abortion – related cases.
In some States this already happened. In 2018 in Mississippi a woman was charged with second – degree murder after seeking health care for a pregnancy loss which happened at home. Prosecutors produced her Internet browser history as proof. After two years she was acquitted of the charges.
Another risk is posed by the so – called data brokers: these are companies that harvest data, cleanse or analyze it and sell them to the highest bidder. These companies could also be used by law enforcement agencies to arbitrarily investigate people who could be related to abortion cases.
The lack of legislation regarding personal data protection is a serious issue in the United States. For example, there is no principle of data minimization as found in the GDPR. The Supreme Courts’ ruling makes this historical moment unexplored territory from a legal point of view. Privacy advisors and activists recommend to try to limit the digital footprint users leave on the web. Also, new laws and bills could be introduce in order to limit the access law enforcement agencies have to personal data.
21. July 2022
European countries were among the first to introduce privacy laws in the context of antitrust and in the competition law framework. As a result of this implementation, in 2019 the German Federal Cartel Office took action to stop Facebook (now a part of Meta Inc.) from further processing personal data that had been acquired through third – party installations (most of all referring to cookies). The proceedings on the matter are still ongoing. Recently also the Irish Data Protection Authority took position against Facebook (which has in the meantime become Meta Inc.), by preventing the American tech giant to transfer user data to the United States due to data safety issues. Also in this matter the parties are still in debate.
In 2014 Facebook notoriously purchased messaging company WhatsApp for almost 22 bln. dollars. At the time Europe did not give much thought to the potential consequences of this merger. This operation was the object of an opinion of the European Commission; in the Commission’s mind the two companies’ privacy policies were way different, and the thought that Facebook now had control over all of the data collected by WhatsApp did not sit well with the European authorities. Another key argument brought forward by the Commission was the lack of an effective competition between the two companies. However, no further action was taken at the time.
A few years later, academic research highlighted the mistake made by the European Commission in not considering the enormous meaning personal data have for these tech companies: due to the fact that personal data are considered to be so – called “nonprice competition”, they play a key role in the strategies and decision – making of big data – driven business models. In particular, when a company depends on collecting and using personal data, it usually lowers the bar of privacy protection standards and raises the number of data collected. This argument was brought forward by the U.K.’s Competition Agency, which stated that by considering the enormous importance personal data have gained in the digital market, companies such as Facebook do not have to face a strong competition in their business.
These arguments and the growing unrest in various DPAs around the globe has brought in 2020 to the notorious investigation of Facebook by the Federal Trade Commission of the United States. In particular the FTC accused Meta Inc. (in particular Facebook) of stifling its competition in order to retain its monopoly of the digital market. On one hand an American court dismissed the claims, but on the other hand the high risks connected with an enormous data collection was highlighted. In particular, according to Section 2 of the Sherman Act, the State has:
- To prove that a company is in fact a monopoly, and
- That it has to harm consumers
This does not apply directly to the case, but the FTC argued that the harm to the consumers is to be seen in Meta Inc.’s lowering privacy standards. The case is still pending as of July 2022.
This merger showed how much privacy and antitrust issues overlap in the digitalized market.
In the following months, policymakers and enforcers both in the United States and in the European Union have been struggling to establish new sets of rules to better regulate mergers between companies whose business model relies on the collection of personal data, and above all they called for more cooperation between privacy and antitrust agencies.
14. July 2022
On July 7, 2022, it became known that the Irish Data Protection Commission (DPC) had forwarded a draft decision concerning Meta’s EU-US data transfers to other European DPAs for consultation. Having to respect a four-week-period, European DPAs may comment on this draft or formulate objections to it. In such an event, the DPC would be given an additional month to respond to the objections raised (article 60 GDPR).
According to information available to politico, the DPC is intending to halt Meta’s EU-US transfer. The DPC is said to have concluded in its out of “own volition” draft decision that Meta can no longer rely on the SCCs when it transfers their user’s personal data to US based servers. In other words, even though Meta has implemented the EU’s SSCs, it cannot be ruled out that US intelligence services may gain access to personal data of data subjects using facebook, instagram and other meta products.
Following the striking down of both, the Safe Harbour Agreement in 2015 and the EU-US Privacy Shield in 2020 by the Court of Justice of the European Union, this draft decision seems to question the legality and compatibility of EU-US data transfers with the GDPR for a third time.
In this context it is worthy to consider a statement Meta made in its annual report to the United States Securities and Exchange Commission (SEC):
“If a new transatlantic data transfer framework is not adopted and we are unable to continue to rely on SCCs or rely upon other alternative means of data transfers from Europe to the United States, we will likely be unable to offer a number of our most significant products and services, including Facebook and Instagram, in Europe, which would materially and adversely affect our business, financial condition, and results of operations.”
Despite the possibility of a halt of Meta’s EU-US data transfers, there is reason to believe that this DPC initiated procedure will be continued in the future and that it will go beyond the previously mentioned four-weeks timeline. “We expect other DPAs to issue objections, as some major issues are not dealt with in the DPC’s draft. This will lead to another draft and then a vote”, says NOYB’s Max Schrems who filed the original complaint to the DPC. Hence, it seems rather unlikely that an instant stop of an EU-US transfer will occur. Instead, we could rather expect article 65 GDPR to be triggered meaning that the EDPB would be required to issue a final decision, including a vote, on the matter.
With no concrete EU-US transfer agreement in sight and the ongoing uncertainty on whether the DPC will eventually succeed with its draft decision, this matter continues to be of big interest.
30. June 2022
In early June, three of the four chairmen of the U.S. congressional committees responsible for data privacy submitted a drafted American Data Privacy and Protection Act (ADPPA) for consideration. If passed, it would override certain recently enacted privacy laws in some U.S. states.
The draft includes elements of the California Consumer Privacy Act and the European General Data Protection Regulation.
States led the way
Until now, data protection in the United States has primarily been at the top of the agenda at the state level. California, Colorado, Connecticut, Virginia and Utah have recently enacted comprehensive data privacy laws. This year alone, more than 100 privacy bills have already been introduced in the states. Although not all of these were adopted, the proliferation of state laws and their varying regulatory requirements has led to increasing calls for the adoption of a federal privacy law. A unified federal law, if passed, would provide much-needed clarity to entities and businesses and, ideally, would also stem the tide of class action and other privacy lawsuits brought under various state laws.
Affected Entities
The ADPPA broadly applies (with exceptions) to organizations operating in the United States that collect, process, or transfer personal information and fall into one of the following categories:
- Subject to the Federal Trade Commission Act
- Nonprofit organizations
- So-called Common Carriers, subject to Title II of the Communications Act of 1934
Requirements of the ADPPA (not final)
- Limit data collection and processing to that which is reasonably necessary
- Compliance with public and internal privacy regulations
- Granting consumer rights such as access, correction, and deletion
- Appeal options
- Obtaining consent before collecting or processing sensitive data, e.g. geolocation, genetic and biometric information, and browsing history
- Appointment of a data protection officer
- Providing evidence that adequate safeguards are in place
- Registration of data brokers with the Federal Trade Commission (FTC)
- FTC will establish and maintain a searchable, centralized online public registry of all registered data traders, as well as a “Do Not Collect” registry that will allow individuals to request all data traders to delete their data within 30 days
- Entities shall not collect, process, or transfer collected data in a manner that discriminates on the basis of race, color, religion, national origin, sex, sexual orientation, or disability
- Implement appropriate administrative, technical, and physical data security practices and procedures to protect covered data from unauthorized access and disclosure
Outcome still uncertain
Shortly after a draft of the ADPPA was released, privacy organizations, civil liberties groups, and businesses spoke out, taking sides for and against the law.
As the legislative session draws to a close, the prospects for ADPPA’s adoption remain uncertain. Strong disagreement remains among key stakeholders on important aspects of the proposed legislation. However, there is consensus that the United States is in dire need of a federal privacy law. Thus, passage of such legislation is quite likely in the foreseeable future.
3. June 2022
On May 10, 2022, Connecticut Gov. Ned Lamont approved the Connecticut Privacy Act (“CTDPA”) concerning Personal Data Privacy and Online Monitoring. The passage of the CTDPA continues the trend in the U.S. for states to individually address consumer rights and business obligations relating to consumer data, in the absence of uniform legislation from the U.S. Congress. This makes Connecticut the 5th state in the United Sates to pass a comprehensive data privacy law.
The CTDPA shares many similarities with the California Consumer Privacy Act (“CPRA”), Colorado Privacy Act (“CPA”), Virginia Consumer Data Protection Act (“VCDPA”) and Utah Consumer Privacy Act (“UCPA”). The Connecticut Privacy Act applies to “personal data”, which is defined as “any information that is linked or reasonably linkable to an identified or identifiable individual,” not including de-identified data or publicly available information. It imposes obligations on both controllers and processors of personal data.
Who does the Connecticut Privacy Act apply to?
The law will apply to individuals and entities who/ that
- conduct business in Connecticut.
- produce products or services that are targeted to Connecticut residents.
- during the preceding calendar year, either controlled or processed the personal data of at least 100,000 consumers (excluding for the purpose of completing a payment transaction) or controlled or processed the personal data of at least 25,000 consumers and derived more than 25% of their gross revenue from the sale of personal data.
Certain entities are exempted, for example:
- State and local government entities
- Nonprofits
- Higher education institutions
- Financial institutions subject to the Gramm-Leach-Bliley Act (“GLB”)
- Entities and business associates subject to the Health Insurance Portability and Accountability Act (“HIPAA”)
Consumers will have the right to:
- access – the right to know what personal data a company has collected about them
- correct inaccuracies in the consumer’s personal data
- delete personal data provided by, or obtained about, the consumer
- obtain a copy of the consumer’s personal data processed by a controller, in a portable and, to the extent technically feasible, readily usable format
- opt out of the processing of their personal data for purposes of targeted advertising, the sale of personal data, or profiling in furtherance of solely automated decisions that produce legal or similarly significant effects concerning the consumer
Among other obligations, controllers will be required to:
- limit the use of the personal data to only the purpose of the collection (“what is adequate, relevant and reasonably necessary”) or as the consumer has authorized
- establish, implement and maintain reasonable administrative, technical and physical data security practices
- not to process personal data of a consumer for purposes of targeted advertising
- obtain consent before processing sensitive data, including data of any individual under the age of 13, and follow the provisions of the Children’s Online Privacy Protection Act
The Connecticut Privacy Act is set to become effective on July 1, 2023. Violation of the CPDPA may result in an enforcement action by the Connecticut Attorney General (AG), who can levy fines and penalties under the Connecticut Unfair Trade Practices Act. However, there is a grace period for enforcement actions until December 31, 2024, for the AG to provide organizations an opportunity to cure any alleged violations.
Like other US data privacy laws, the Connecticut laws are not as comprehensive as the EU’s GDPR but they better align with some of the definitions and especially the mechanisms of consent.
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