Data breaches and technology are evolving at such a rapid rate. In the first half of 2020 alone, data breaches significantly increased by 273% compared to 2019, making privacy laws and regulations such as the CCPA paramount in protecting consumer rights. California is leading the way for privacy compliance, as the fifth-largest global economy, the CCPA forces many companies to address privacy compliance.
The CCPA is one of the most comprehensive laws in the United States and went into effect on January 1st, 2020 and is enforceable as of July 1st, 2020. This law grants California's consumers certain rights to their privacy, such as a private right of action if their data is involved in a data breach. Consumers can also request the right to know if companies are selling their data and have a right to opt-out of the sale of their data, including the right to delete and/or correct that data.
Is the CCPA Enough to Protect Consumer Privacy?
The Californians for Consumer Privacy, led by Alistair Mactaggart, are pushing for a more stringent regulation with the California Privacy Rights Act. The CPRA is Proposition 24 on the November 2020 ballot in California and would amend the CCPA entirely if passed. This new measure would expand the CCPA to new heights by introducing a new privacy enforcement agency (California Privacy Protection Agency) that focuses solely on enforcing privacy violations at the same time as extending the current exemption for employment data to 2023.
In addition, the CPRA would allow consumers the right to correct their data, potential exemptions for unstructured data in right to know requests, the creation of a category for sensitive information, and stricter rules for protecting a minor's data by tripling the fines associated with violating a minor's privacy rights.
What Impact Will CPRA Have on Consumers and Businesses?
The CPRA will change the threshold for businesses by narrowing the criteria for companies to fall in scope for this potential privacy law. An organization must meet one of the following; receive personal data from at least 100,000 California consumers or $25 million, or 50% of their revenue from selling data. The proposed requirements exclude devices from that count if not linked to a consumer and adds "sharing" as the third criterion for applicability if a business derives more than 50% of its revenue from selling or sharing data.
If CPRA passes then consumers will gain additional privacy benefits, allowing for more control over their data and a more stringent enforcement agency to protect their privacy rights.
What's the CPRA Ripple Effect?
The CPRA heightens the bar for other states as they start thinking about consumer privacy and security, especially with the significant rise in data breaches since companies have shifted to a work from home strategy due to the COVID-19 pandemic.
If the CPRA amends the CCPA, this sets a firm foundation for other states to emulate in protecting consumer privacy. For example, the Massachusetts Attorney General Maura Healey recently announced the creation of a data privacy and security division led by Sara Cable. At the same time, New York recently enacted two laws expanding its breach notification and security safeguards requirements. Other states are strategizing on how to set privacy regulation forward. However, until the pandemic subsides, it could be a wait and see approach.
The Californians for Consumer Privacy, recently announced Andrew Yang as the advisory board's chair, bringing more attention to data privacy rights. As more influencers like Yang jump on board to support privacy initiatives such as the CPRA the more visibility and impact these campaigns will have on future legislation outside California.
According to a poll conducted in early August, the likelihood of the CPRA passing is highly likely. Companies should start thinking about how the CPRA will affect their privacy strategy in 2021. Stay tuned for more news on the CPRA and other privacy regulations.