On February 3, the California Privacy Protection Agency (CPPA) Board voted unanimously to adopt and approve updated regulations for implementing the California Privacy Rights Act (CPRA). The proposed final regulations will now go to the Office of Administrative Law, who will have 30 working days to review and approve or disapprove the regulations. As previously covered by InfoBytes, the CPRA (largely effective January 1, 2023, with enforcement delayed until July 1, 2023) was approved by ballot measure in November 2020 to amend and build on the California Consumer Privacy Act (CCPA). In July 2022, the CPPA initiated formal rulemaking procedures to adopt proposed regulations implementing the CPRA, and in November the agency posted updated draft regulations (covered by InfoBytes here and here).
According to the CPPA’s final statement of reasons, the proposed final regulations (which are substantially similar to the version of the proposed regulations circulated in November) address comments received by stakeholders, and include the following modifications from the initial proposed text:
- Amending certain definitions. The proposed changes would, among other things, modify the definition of “disproportionate effort” to apply to service providers, contractors, and third parties in addition to businesses, as such term is used throughout the regulations, to limit the obligation of businesses (and other entities) with respect to certain consumer requests. The term is further defined as “when the time and/or resources expended to respond to the request significantly outweighs the reasonably foreseeable impact to the consumer by not responding to the request,” and has been modified “to operationalize the exception to complying with certain CCPA requests when it requires ‘disproportionate effort.’” The proposed changes also introduce the definition of “unstructured” personal information, which describes personal information that could not be retrieved or organized in a predefined manner without disproportionate effort on behalf of the business, service provider, contractor, or third party as it relates to the retrieval of text, video, and audio files.
- Outlining restrictions on how a consumer’s personal information is collected or used. The proposed changes outline factors for determining whether the collection or processing of personal information is consistent with a consumer’s “reasonable expectations.” The modifications also add language explaining how a business should “determine whether another disclosed purpose is compatible with the context in which the personal information was collected,” and present factors such as the reasonable expectation of the consumer at the time of collection, the nature of the other disclosed purpose, and the strength of the link between such expectation and the nature of the other disclosed purpose, for assessing compatibility. Additionally, a section has been added to reiterate requirements “that a business’s collection, use, retention, and/or sharing of a consumer’s personal information must be ‘reasonably necessary and proportionate’ for each identified purpose.” The CPPA explained that this guidance is necessary for ensuring that businesses do not create unnecessary and disproportionate negative impacts on consumers.
- Clarifying requirements for consumer requests and obtaining consumer consent. Among other things, the proposed changes introduce technical requirements for the design and implementation of processes for obtaining consumer consent and fulfilling consumer requests, including but not limited to “symmetry-in-choice,” which prohibits businesses from creating more difficult or time consuming paths for more privacy-protective options than paths to exercise a less privacy protective options. The modifications also provide that businesses should avoid choice architecture that impairs or interferes with a consumer’s ability to make a choice, as “consent” under the CCPA requires that it be freely give, specific, informed, and unambiguous. Moreover, the statutory definition of a “dark pattern” does not require that a business “intend to design a user interface to have the substantial effect of subverting or impairing consumer choice.” Additionally, businesses that are aware of, but do not correct, broken links and nonfunctional email addresses may be in violation of the regulation.
- Amending business practices for handling consumer requests. The revisions clarify that a service provider and contractor may use self-service methods that enable the business to delete personal information that the service provider or contractor has collected pursuant to a written contract with the business (additional clarification is also provided on a how a service provider or contractor’s obligations apply to the personal information collected pursuant to its written contract with the business). Businesses can also provide a link to resources that explain how specific pieces of personal information can be deleted.
- Amending requests to correct/know. Among other things, the revisions add language to allow “businesses, service providers, and contractors to delay compliance with requests to correct, with respect to information stored on archived or backup systems until the archived or backup system relating to that data is restored to an active system or is next accessed or used.” Consumers will also be required to make a good-faith effort to provide businesses with all necessary information available at the time of a request. A section has also been added, which clarifies “that implementing measures to ensure that personal information that is the subject of a request to correct remains corrected factors into whether a business, service provider, or contractor has complied with a consumer’s request to correct in accordance with the CCPA and these regulations.” Modifications have also been made to specify that a consumer can request that a business disclose their personal information for a specific time period, and changes have been made to provide further clarity on how a service provider or contractor’s obligations apply to personal information collected pursuant to a written contract with a business.
- Amending opt-out preference signals. The proposed changes clarify that the requirement to process opt-out preference signals applies only to businesses that sell or share personal information. Language has also been added to explain that “the opt-out preference signal shall be treated as a valid request to opt-out of sale/sharing for any consumer profile, including pseudonymous profiles, that are associated with the browser or device for which the opt-out preference signal is given.” When consumers do not respond to a business’s request for more information, a “business must still process the request to opt-out of sale/sharing” to ensure that “a business’s request for more information is not a dark pattern that subverts consumer’s choice.” Additionally, business should not interpret the absence of an opt-out preference signal as a consumer’s consent to opt-in to the sale or sharing of personal information.
- Clarifying requests to limit use and disclosure of sensitive personal information. The regulations require businesses to provide specific disclosures related to the collection, use, and rights of consumers for limiting the use of personal sensitive information in certain cases, including, among other things, requiring the use of a link to “Limit the Use of My Sensitive Personal Information” and honoring any limitations within 15 business days of receipt. The regulations also provide specific enumerated business uses where the right to limit does not apply, including to ensure physical safety and to prevent, detect, and investigate security incidents.
The proposed final regulations also clarify when businesses must provide a notice of right to limit, modify how the alternative opt-out link should be presented, provide clarity on how businesses should address scenarios in which opt-out preference signals may conflict with financial incentive programs, make changes to service provider, contractor, and third party obligations to the collection of personal information, as well as contract requirements, provide clarity on special rules applicable to consumers under 16-years of age, and modify provisions related to investigations and enforcement.
Separately, on January 10, the CPPA posted a preliminary request for comments on cybersecurity audits, risk assessments, and automated decisionmaking to inform future rulemaking. Among other things, the CPPA is interested in learning about steps it can take to ensure cybersecurity audits are “thorough and independent,” what content should be included in a risk assessment (including whether the CPPA should adopt the approaches in the EU GDPR and/or Colorado Privacy Act), and how “automated decisionmaking technology” is defined in other laws and frameworks. The CPPA noted that this invitation for comments is not a proposed rulemaking action, but rather serves as an opportunity for information gathering. Comments are due March 27.