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White House Issues Proposal for FTC-Regulated Data Privacy Protection

03/11/2015

On February 27, 2015, the White House proposed legislation to protect consumers’ personal data and information that is collected and used by private companies and nonprofits. Federal and state governments and their agencies are not covered by the proposed law. 

The proposal, The Consumer Privacy Bill of Rights Act, would require covered entities to provide individuals with notice of their privacy and security practices and allow individuals a reasonable opportunity to review their data, correct it, have it deleted and withdraw consent for its continued use. Private companies, nonprofits or industry trade groups can avoid penalties by obtaining approval from the Federal Trade Commission (FTC) of their procedures and criteria for collecting, maintaining, sharing and using personal data (termed a “code of conduct” in the proposal). The proposal envisions that these codes of conduct can be developed and submitted to the FTC by private industry or trade groups, or initiated by the Department of Commerce with private industry. The proposal envisions that any FTC-approved code of conduct will carry with it a presumption of reasonableness and adherence to such a code will provide a “safe harbor” from penalties. The privacy proposal expressly excludes a private right of action and vests enforcement exclusively with the FTC and the state attorneys general.

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