Colorado Privacy Act officially enacted into Law
On July 8, 2021, the state of Colorado officially enacted the Colorado Privacy Act (CPA), which makes it the third state to have a comprehensive data privacy law, following California and Virginia. The Act will go into effect on July 1, 2023, with some specific provisions going into effect at later dates.
The CPA shares many similarities with the California Consumer Privacy Act (CCPA) and the Virgina Consumer Data Protection Act (CDPA), not having developed any brand-new ideas in its laws. However, there are also differences. For example, the CPA applies to controllers that conduct business in Colorado or target residents of Colorado with their business, and controls or processes the data of more than 100 000 consumers in a calendar year or receive revenue by processing data of more than 25 000 consumers. Therefore, it is broader than the CDPA, and does not include revenue thresholds like the CCPA.
Similar to the CDPA, the CPA defines a consumer as “a Colorado resident acting only in an individual or household context” and explicitly omits individuals acting in “a commercial or employment context, as a job applicant, or as a beneficiary of someone acting in an employment context”. As a result, controllers do not need to consider the employee personal data they collect and process in the application of the CPA.
The CPA further defines “the sale of personal information” as “the exchange of personal data for monetary or other valuable consideration by a controller to a third party”. Importantly, the definition of “sale” explicitly excludes certain types of disclosures, as is the case in the CDPA, such as:
- Disclosures to a processor that processes the personal data on behalf of a controller;
- Disclosures of personal data to a third party for purposes of providing a product or service requested by consumer;
- Disclosures or transfer or personal data to an affiliate of the controller’s;
- Disclosure or transfer to a third party of personal data as an asset that is part of a proposed or actual merger, acquisition, bankruptcy, or other transaction in which the third party assumes control of all or part of the controller’s assets;
- Disclosure of personal data that a consumer directs the controller to disclose or intentionally discloses by using the controller to interact with a third party; or intentionally made available by a consumer to the general public via a channel of mass media.
The CPA provides five main consumer rights, such as the right of access, right of correction, right of deletion, right to data portability and right to opt out. In case of the latter, the procedure is different from the other laws. The CPA mandates a controller provide consumers with the right to opt out and a universal opt-out option so a consumer can click one button to exercise all opt-out rights.
In addition, the CPA also provides the consumer with a right to appeal a business’ denial to take action within a reasonable time period.
The CPA differentiates between controller and processor in a similar way that the European General Data Protection Regulation (GDPR) does and follows, to an extent, similar basic principles such as duty of transparency, duty of purpose specification, duty of data minimization, duty of care and duty to avoid secondary use. In addition, it follows the principle of duty to avoid unlawful discrimination, which prohibits controllers from processing personal data in violation of state or federal laws that prohibit discrimination.