United States: FTC Staff Releases Paper Highlighting Key Privacy And Security Issues For Autonomous And Connected Vehicles

The Federal Trade Commission Staff (FTC) released a new "Staff Perspective" on January 9, 2018, that highlights key privacy and data security issues related to autonomous and connected vehicles. The Staff Perspective outlines four key takeaways from a workshop hosted by the FTC and the National Highway Traffic Safety Administration (NHTSA) on June 28, 2017. It also summarizes recent legislative and regulatory developments and indicates that the FTC will continue to monitor the connected car marketplace. Companies that manufacture or integrate with connected car technology should keep a close eye on future FTC actions in this marketplace, and they should understand that the FTC expects businesses to protect the privacy and security of information relating to consumers when collecting, using, or sharing data through connected cars.

We summarize below the FTC's key takeaways from the workshop.

1. Many companies throughout the connected car ecosystem will collect data from vehicles, much of which will be used to provide important benefits to consumers

First, the Staff Perspective notes that many different entities will collect data from connected vehicles, including car manufacturers, manufacturers of "infotainment" systems, third parties that provide peripherals that plug into ports on cars, and auto insurance companies. This observation should not be surprising given the proliferation of Internet-connected devices and the increasing use of advanced navigation, safety, and entertainment technologies in modern vehicles.

The Staff Perspective also notes that much of the data will be used to provide important benefits to consumers. This suggests that FTC Staff will balance the potential benefits of connected car technologies against the privacy and data security concerns that arise from the increased collection, use, and sharing of data. However, the Staff Perspective also cautions that workshop participants disagreed on whether certain uses—such as providing "good driver" discounts to consumers who demonstrate good driving habits—would ultimately benefit or harm consumers. The Staff Perspective does not weigh in on the lawfulness of specific practices, but we expect that the FTC Staff will keep a close eye on any new uses of data in the connected car ecosystem and will scrutinize any practices that it views as potentially unfair or deceptive, in violation of Section 5 of the FTC Act.

2. The types of data collected through connected cars will range from aggregate data, to non-sensitive data about a particular vehicle or individual, to sensitive personal data

Second, the Staff Perspective emphasizes that companies will collect various types of data through connected cars, including aggregate data, non-sensitive data about a particular vehicle or individual, and sensitive personal data. The Staff Perspective notes, for example, that entities may collect and use aggregate data for traffic management to reduce congestion or may collect and use non-sensitive personal data to measure a particular car's gas mileage. Sensitive data would include information "such as a fingerprint or iris pattern for authentication purposes, or information about the vehicle's – and the occupants' – real-time location."

These distinctions regarding the types of data collected are important. For example, in prior guidance, the FTC has cautioned that companies must obtain affirmative express (e.g., opt-in) consent from consumers before collecting, using, or sharing sensitive information (such as precise location data, health data, financial data, data regarding children, and data regarding consumers' television viewing habits). Further, if non-sensitive data can be reasonably linked to a specific consumer, computer, or other device (such as a vehicle or its computer systems), the FTC has indicated in prior guidance that companies should follow the privacy framework outlined in its 2012 report titled Protecting Consumer Privacy in an Era of Rapid Change: Recommendations for Businesses and Policymakers ("2012 Privacy Report"). The FTC's privacy framework contains detailed principles that call for privacy-by-design, increased transparency, and simplified consumer choice.

3. Consumers may be concerned about secondary, unexpected uses of data

Third, the Staff Perspective cautions that consumers may be concerned about secondary, unexpected uses of data. For example, the Staff Perspective notes that some consumers may have concerns if personal information collected through a vehicle's infotainment system—such as information regarding the occupants' browsing habits or app usage—were sold to third parties for targeted advertising purposes. The Staff Perspective notes that workshop participants agreed that it is critical to address such consumer privacy concerns in a manner that encourages acceptance and adoption of the emerging technologies behind connected cars.

To address such privacy concerns, the Staff Perspective appears to support self-regulation in the connected car industry (at least for the moment), which is consistent with the regulatory approach that the FTC Staff has taken in other industries, such as the online behavioral advertising industry. For example, the Staff Perspective notes that the Consumer Privacy Protection Principles for Vehicle Technologies and Services were jointly introduced by the Alliance of Automobile Manufacturers and Global Automakers in 2014 and that such industry initiatives are "an important step" in addressing privacy concerns in the connected car ecosystem. Those self-regulatory guidelines—which apply to participating automakers but do not apply directly to third-party service providers, app providers, or independent dealerships—are based on the following broad principles:

  • Transparency: Participating members commit to providing owners and registered users with ready access to clear, meaningful notices about the participating member's collection, use, and sharing of covered information;
  • Choice: Participating members commit to offering owners and registered users with certain choices regarding the collection, use, and sharing of covered information;
  • Respect for Context: Participating members commit to using and sharing covered information in ways that are consistent with the context in which the covered information was collected, taking account of the likely impact on owners and registered users;
  • Data Minimization, De-Identification & Retention: Participating members commit to collecting covered information only as needed for legitimate business purposes. participating members commit to retaining covered information no longer than they determine necessary for legitimate business purposes;
  • Data Security: Participating members commit to implementing reasonable measures to protect covered information against loss and unauthorized access or use;
  • Integrity & Access: Participating members commit to implementing reasonable measures to maintain the accuracy of covered information and commit to giving owners and registered users reasonable means to review and correct personal subscription information; and
  • Accountability: Participating members commit to taking reasonable steps to ensure that they and other entities that receive covered information adhere to the Principles.

The Staff Perspective also notes, however, that some consumer advocates at the workshop expressed concern that it is not easy for consumers to understand companies' information practices and that it would be helpful to develop a central portal where consumers could compare automakers' different privacy policies. These concerns suggest that, in the future, the FTC Staff and consumer privacy advocates may scrutinize whether privacy notices and choices offered to consumers are sufficiently clear and prominent and are provided at a time and in a context in which the consumer is making a decision about his or her data (e.g., "just-in-time" notices that appear outside of the privacy policy).

For example, in the context of online behavioral advertising, where information about a user's web browsing and mobile app usage history across unaffiliated websites and mobile apps is used to deliver targeted advertising to the user, the FTC and self-regulatory organizations have encouraged companies to design innovative ways, outside of the privacy policy, to provide disclosures and choices to consumers. (See, e.g., the FTC Staff's 2009 Report on Self-Regulatory Principles for Online Behavioral Advertising ("OBA") and the Digital Advertising Alliance's Self-Regulatory Principles for Online Behavioral Advertising). The online advertising industry has implemented such guidance by adopting an easily-recognizable "AdChoices" icon that participating companies may display in or around advertisements that are delivered using OBA data, and which links to the company's privacy policy notice and an opt-out mechanism. This allows consumers to easily learn more and make choices about potentially unexpected uses of their web data for targeted advertising purposes.

The Staff Perspective also notes that, in the connected car ecosystem, different approaches may be necessary depending on whether data is safety-critical or not. For example, the Staff Perspective indicates that it may not be appropriate to provide consumers with the ability to opt out of sharing safety-critical data with surrounding vehicles, such as vehicle-to-vehicle communications that regularly transmit "Basic Safety Messages" about speed, direction, brake status, and other vehicle information. However, the Staff Perspective notes that data generated from a consumer's interactions with infotainment systems are not safety-critical. In such cases, the Staff Perspective notes that participants in the workshop agreed that consumers should be provided with "clear, easily understandable information about if and how their information is being collected, stored, or transmitted and how they can access or delete that information."

4. Connected and autonomous vehicles will have cybersecurity risks that can potentially be exploited

Fourth, the Staff Perspective emphasizes that connected and autonomous vehicles will have cybersecurity risks that can potentially be exploited. The FTC Staff's data security concerns focus on hackers' ability to access vehicles remotely, to share attack vectors in a manner that would simplify follow-up attacks, and to launch attacks that affect a large number of connected vehicles. To address such risks, the Staff Perspective notes that workshop panelists recommended increasing information sharing, improving network design, conducting risk assessment and mitigation, and setting standards for baseline security in connected cars.

5. Developments since the workshop

Finally, the Staff Perspective notes that there have been other important developments since the FTC and NHTSA held the workshop last year. For example, the Staff Perspective notes that the U.S. House of Representatives unanimously passed H.B. 3388, the Safely Ensuring Lives Future Deployment and Research in Vehicle Evolution (SELF DRIVE) Act, and that the U.S. Department of Transportation and the NHTSA released new guidance for automated vehicles, titled Automated Driving Systems 2.0: A Vision for Safety.

The Staff Perspective notes that the SELF DRIVE Act would require manufacturers of "highly automated vehicles" to develop a written cybersecurity plan that includes, among other things, vulnerability detection and response practices and a process for controlling access to automated driving systems. The Staff Perspective also notes that while the NHTSA's new guidance does not directly address privacy, the NHTSA's Q&A document accompanying the new guidance highlights the important role of the FTC in protecting consumer privacy in the connected car industry.

Looking forward

The FTC's Staff Perspective indicates that FTC Staff will continue to monitor the connected car marketplace. At least for the moment, FTC Staff appears willing to allow individual companies and self-regulatory programs to continue developing privacy and security principles and best practices for connected car technologies. In the meantime, however, the Staff Perspective also notes that the FTC Staff will use its civil authority under Section 5 of the FTC Act to bring enforcement actions against companies that engage in unfair or deceptive practices, such as if a company makes materially false or misleading statements to consumers regarding its privacy or data security practices or fails to have "adequate security protections," as described in the FTC's Start with Security guidance document and its Stick with Security Blog series.

Given the abundance of data collection, the concerns about secondary uses of data that may be unexpected by reasonable consumers under the circumstances, and the potential for significant cybersecurity risks, the Staff Perspective highlights the need for companies in the connected car ecosystem to be proactive and to build privacy and security into their products at every stage of development. In this regard, companies should review the FTC's 2012 Privacy Report and subsequent reports that address privacy and security issues in more traditional contexts, and they should think strategically about additional steps they can take to address privacy issues that are unique to connected car technologies.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions