United States: Privacy & Information Security Law Blog: CIPL Responds To NTIA Request For Comment On Developing The Administration's Approach To Consumer Privacy

The Centre for Information Policy Leadership ("CIPL") at Hunton Andrews Kurth LLP recently submitted formal comments to the U.S. Department of Commerce's National Telecommunications and Information Administration ("NTIA") in response to its request for public comments on developing the administration's approach to consumer privacy.

In its comments, CIPL commends NTIA for initiating a renewed national debate on updating the U.S. privacy framework, and notes that its approach—starting with the intended outcomes and goals of any privacy regime—is well suited to lay the foundation for a legislative proposal in the future.

Responding to the questions raised in the request for comment, CIPL makes the following observations and recommendations with regard to NTIA's intended core outcomes and the high level goals of any new U.S. privacy framework:

Privacy Outcomes

  • Transparency: CIPL agrees transparency should be a key outcome of any privacy framework and must be user-centric, contextual and tailored toward the specific audience and purpose. This can be achieved by implementing companywide privacy management and accountability frameworks.
  • Control: CIPL believes that control should be a component of a new privacy framework in contexts where it is appropriate, and should reference mechanisms that empower consumers beyond individual choice or consent. However, the framework's general focus should be putting the onus on organizations to use data responsibly and accountably to protect consumers from harm regardless of their individual level of engagement.
  • Reasonable Minimization: CIPL supports the inclusion of reasonable minimization as an outcome of a new data protection framework, and further agrees with NTIA's qualification that minimization should be reasonable and appropriate to the context and risk of privacy harm. These qualifiers are very important given the enormous potential of personal data for driving economic growth and societal benefits in the digital economy.
  • Security: CIPL fully agrees with the inclusion of security in the list of outcomes, and notes the importance of allowing organizations flexibility in determining security measures that are reasonable and appropriate to the context at hand. In addition, a security outcome should provide for the adoption of appropriate breach response measures (e.g., notification requirements) and should permit organizations to use personal data for the development and implementation of security tools and related legitimate purposes, such as incident prevention, detection and monitoring.
  • Access and Correction: While CIPL agrees that access, correction and deletion is an important outcome, such rights cannot be absolute and should not interfere with relevant obligations of an organization, other societal goals or legal rights of consumers and other third parties. Where exercising such rights would be inappropriate or impose unreasonable burdens on organizations, part of the solution lies in providing assurances to consumers that their personal information is protected by the full range of available accountability measures and will not be used for harmful purposes.
  • Risk Management: CIPL welcomes NTIA's characterization of risk management as the "core" of its approach to privacy protection. Identifying harms and addressing them specifically has the advantage of enabling organizations to prioritize their compliance measures and focus resources on what is most important, thereby strengthening both consumer privacy and organizations' ability to engage in legitimate and accountable uses of personal information. It also means that we do not need to establish set categories of so-called sensitive information or certain predetermined high-risk processing activities, as any actual sensitivity or high-risk character will be determined and addressed in each risk assessment process.
  • Accountability: CIPL strongly agrees with including accountability in the essential outcomes of a privacy framework. It is a key building block of modern data protection and is essential for the future of the digital society where laws alone cannot deliver timely, flexible and innovative solutions. CIPL recommends that NTIA clarify and elaborate upon this important concept in line with its globally accepted meaning, including in the APEC Privacy Framework and the GDPR, as well as other relevant international privacy regimes that incorporate this concept.
  • Complaint-handling and Redress: In addition to the above outcomes, CIPL recommends the additional outcome of complaint-handling and redress. Consumers should be able to expect that organizations are able to reliably, quickly and effectively respond to actionable complaints and provide redress where appropriate. As it is consumer-facing, it should be a separately stated outcome that consumers can expect from a privacy framework.

High-Level Goals for Federal Action

  • Harmonization: CIPL supports the effort to harmonize the U.S. privacy framework on the federal level, including through federal legislation that preempts inconsistent state privacy laws. CIPL recommends that NTIA clarify whether the proposed framework intends to cover employees, and suggests that a new framework should be focused on privacy in the consumer and commercial context and that the precise term "consumer" be defined to avoid legal uncertainty.
  • Legal Clarity and Flexibility to Innovate: Clarity and flexibility in a privacy framework can be achieved through an approach based on organizational accountability risk assessment. With respect to risk, agreement around methodologies for privacy assessments, guidance on types of risk and the sharing of organizational best practices can also significantly contribute to legal clarity without undermining the flexibility to innovate.
  • Comprehensive Application: CIPL supports a comprehensive baseline privacy law that applies to all organizations, preempts inconsistent state laws, amends or replaces inconsistent federal privacy laws where appropriate, and otherwise works with or around well-functioning existing sectoral laws.
  • Risk and Outcome-based Approach: CIPL agrees with the goal of creating a risk and outcome based approach to privacy regulation. Employing such an approach places the burden of protecting consumers directly where it belongs – on businesses that use personal data, rather than on consumers, who in an increasing number of contexts should not and realistically cannot be tasked with understanding in detail and managing for themselves complex data uses or constantly making choices about them.
  • Interoperability: Maximizing interoperability between different legal and privacy regimes should be a top priority goal for the United States. Any new privacy framework for the U.S. should continue to enable the free, responsible and accountable flow of data across borders.
  • Incentivizing Privacy Research: CIPL fully agrees with the goal of having the U.S. government encourage and incentivize research into and development of products and services that improve privacy protections. However, this goal should be broadened and amplified along the lines of the argument for incentivizing organizational accountability generally. This enables a race to the top whereby organizations not only strive to comply with the bare minimum of what is legally required but are incentivized and rewarded for heightened levels of organizational accountability that benefit all stakeholders.
  • FTC Enforcement: CIPL agrees that the Federal Trade Commission should be the principal federal agency to enforce any new comprehensive U.S. privacy legislation and should be appropriately resourced as such. Exactly how a new privacy framework and the FTC as the principal federal agency should interact with other federal functional regulators and sectoral privacy laws should be carefully considered and worked out with input from all relevant stakeholders.
  • Scalability: CIPL agrees that enforcement should be proportionate to the scale and scope of the information an organization is handling and should be outcome-based. With increased responsibilities under a broader privacy law, the FTC will have to ensure that its current approach is adapted to the changes in the scope and nature of its responsibilities.
  • Enabling Effective Use of Personal Information: In addition to the above goals for federal action, CIPL suggests the additional goal of enabling broad and effective uses of personal information for the benefit of economic development and societal progress, as well as for the benefit of individuals, particularly the data subjects. Due to their supervisory position, modern data protection and privacy enforcement authorities have the responsibility, in addition to protecting consumer privacy, to safeguard and facilitate the beneficial potential of such information and, therefore, the full range of responsible and accountable data uses.

Following consideration of the comments it receives, CIPL recommends that NTIA takes a holistic and deliberate approach toward developing a comprehensive privacy law that accomplishes the items discussed in the request for comment. One possible next step could be to actually articulate the outcomes and goals in draft legislative language to provide a clearer basis for further discussion on the precise elements and articulation of each of them. CIPL recommends an iterative process between NTIA and other public and private sector stakeholders towards that goal.

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.

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