Perhaps the only thing higher than temperatures this summer in the European Union is the level of regulatory attention being paid to data-driven advertising and website cookie practices (including similar tracking technologies within mobile applications and other non-browser environments, collectively referred to here as “cookies”). This TrustArc blog post summarizes the major announcements and publications regulators have issued over the last few weeks, including what is expected to follow–and how TrustArc helps.
UK ICO Report on Ad Tech, RTB and Privacy. First, the United Kingdom’s Information Commissioner’s Office (ICO) released on June 20th an “Update Report Into Adtech and Real Time Bidding,” which concluded that advertising technology-related entities and those involved in real time bidding (RTB) should reassess their privacy notices, lawful processing bases, and personal data uses and sharing in light of the GDPR, as many have not to this point. The ICO is in the midst of evaluating practices within the advertising industry, in keeping with the view announced in its 2018-2021 Technology Strategy that web and cross-device tracking is one of its three “priority areas” for the current period. The report’s findings:
- pointed out deficiencies in publishers’ transparency practices, such as not specifically naming third party recipients of personal data collected on the basis of consent;
- adjudged that “special categories” of personal data included in targeted programmatic auction bid requests (e.g., inferred ethnic, health, sexual orientation or political audience segments associated with specific cookie or other unique identifiers bid on by advertisers) are regularly being processed unlawfully by ad tech companies due to failure to obtain explicit consent from data subjects;
- clarified that consent–rather than legitimate interests–is not only required for the placement or accessing of cookies or similar tracking technologies on an end user’s device (under the U.K.’s PECR rules implementing the EU’s “ePrivacy” Directive), but is also generally the appropriate lawful processing basis for the real-time bidding transactions that underpin the programmatic auctions between buyers and sellers of ad spaces for targeted advertising; and
- noted that “the ICO has published [pursuant to GDPR Article 35(4)] a list of processing operations likely to result in…high risk, for which [Data Protection Impact Assessments] are mandatory, [and] RTB matches a number of examples on this list,” resulting in the conclusion that RTB-involved “organizations are therefore legally required to perform DPIAs.”
The ICO’s report identified areas where it has concerns and expects to see changes, but it also articulated a recognition that the ad tech sector is “an extremely complex environment” that does not change overnight. With this in mind, the ICO indicated that it seeks to “take a measured and iterative approach, before undertaking a further industry review in six months’ time.”
CNIL’s Change of Consent Interpretation and Timeline. Next, the French privacy regulator, the CNIL, announced on June 28th that in light of a rise in complaints and requests related to online marketing, it has devised an action plan for the next year making “targeted online advertising a priority topic for 2019.” Part of this plan will be the release this month of new guidelines that will rescind the CNIL’s 2013 interpretation that continued navigation of a website could be understood as an expression of an end user’s consent to the placement of website cookies or similar tracking technologies. The CNIL indicated that it will give stakeholders a transitional period of 12 months during which “scrolling down, browsing or swiping through a website or application will still be considered by the CNIL as acceptable.” Still, the CNIL will regularly investigate matters of transparency, withdrawal of consent, security obligations and more, including instances when cookies are impermissibly set before consent is collected for ePrivacy purposes. The CNIL’s calendar lists its tentative schedule for cookie-related matters as follows:
- May – June 2019: Update of the CNIL standards to align with the GDPR (i.e., update of the CNIL’s 2013 interpretation of consent for cookies);
- June – Sept 2019: Stakeholder working group to test the operational consistency of the guidelines;
- November 2019: Results of work
- End of 2019 – Early 2020: Publication of new guidelines for cookies
- June – July 2020: End of the grace period, entities must comply with the rules of the new guidelines.
Cookie Consent and Transparency. The ICO’s guidance confirms that if using cookies, the operator of an online service must inform users of what cookies will be set, explain what the cookies do, and obtain consent to storing cookies on a device before doing so. Moreover, if using any third party cookies, the operator must clearly and specifically name who the third parties are and explain what they will do with the information. Exempted from these requirements are cookies needed to transmit a communication over an electronic communications network, as well as cookies that are “strictly necessary” to provide a service or site requested by the user.
Lawful Processing Basis. Whereas PECR addresses the storing or accessing of information on users’ browsers and devices by requiring consent as a prerequisite to doing so, the GDPR (and its six possible lawful processing bases under Article 6) governs the processing of any personal data gained from cookies. In its guidance, the ICO recognizes that “it may be possible to rely on an alternative lawful basis for subsequent processing beyond the setting of any cookies,” but separately states that, “trying to apply another lawful basis such as legitimate interests when you already have GDPR-compliant consent would be an entirely unnecessary exercise, and would cause confusion for your users.”
The regulator also noted that any data processing involving analyzing or predicting preferences or behavior, or tracking and profiling for direct marketing and advertising purposes, will in most cases require consent as the lawful processing basis. Also confirmed is that “consent is necessary for first-party analytics cookies, even though they might not appear to be as intrusive as others that might track a user across multiple sites or devices,” although the ICO concedes that the setting of a first party analytics cookie “results in a low level of intrusiveness and low risk of harm to individuals,” and that “it is unlikely that priority for any formal action would be given” to such instances.
Cookie Audits and Banners. The ICO also emphasizes the utility of performing comprehensive “cookie audits” to detail what cookies are being used on a site and to discern which of them comprise “strictly necessary” first and third party cookies versus those which do not. The guidance likewise addresses forms of notice and means of consent, including prominently displayed cookie banners that provide clear information about cookies and user control options to allow or disallow those that are non-essential.
It further notes that the blanket use of “cookie walls,” which require users to agree or accept the setting of non-strictly necessary cookies before the user can access the rest of the site’s content, will generally amount to invalid consent because the user lacks a genuine choice other than to acquiesce in order to use the site. Lastly, the ICO declined to specify how often consent should be obtained from users, noting that this is dependent on a number of factors such as frequency of visitors or updates of content or functionality.
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