An Internet Society report finds that most organizations do not comply with existing global privacy regulations and are not ready for additional regulations going into effect in 2020.
The report, “Are Organizations Ready for New Privacy Regulations?” by the Online Trust Alliance (OTA) analyzed 29 variables in 1,200 privacy statements against common themes in three major privacy regulations: the European Union’s General Data Protection Regulation (GDPR), the California Consumer Privacy Act (CCPA), and Canada’s Personal Information Protection and Electronic Documents Act (PIPEDA).
The report revealed that many organizations’ privacy statements fail to meet common privacy principles outlined in GDPR, CCPA, PIPEDA, including the user’s right to request information, to understand how their data is being shared with third parties and the ability of that information to be deleted upon request. Organizations also have a duty to notify users of their rights in an easily understandable matter.
While the organizations audited were mainly US-based and do not yet have a legal obligation to meet all requirements, these regulations represent general benchmarks for consumer privacy and set the stage for new laws going into effect in 2020, including the California Consumer Privacy Act (CCPA).
The audit analyzed organizations across the following areas:
Data Handling
- The majority (98%) of privacy statements had some language about data sharing with two-thirds (67%) stating that they do not share data with third parties. However, less than 1% of organizations had language stating which types of third parties could access user data.
- While not yet a requirement in the US, none of the organizations audited had any language regarding users being notified if their information was sold or shared.
- A vast number of major cyber incidents include some type of failure on the part of a third party. Many privacy regulations are now requiring that any third parties the organizations work with are held to the same data sharing standards they hold themselves to. Only 57% of organizations currently say they hold third parties to this standard.
- Many privacy regulations highlight data retention as an important concept, as many unauthorized data releases occur when an attacker accesses stored information that the company did not need to keep. Only 2% of organizations had explicit language about data retention.
User Access to Data
- When CCPA goes into effect in January 2020, organizations will need to explicitly state how users can access their data and potentially request it to be deleted. Currently, hardly any organizations explicitly outline how to get in touch for this purpose.
Statements are Understandable and Effective Date is Clear
- Privacy statements must be easy to find and must be simple for users to understand. One component of this is offering privacy statements in multiple languages, which only 3.5% of the organizations analyzed did.
- For the first time in 2019 OTA tracked the concept of “readability” directly. OTA analysts scored each statement and 32% of organizations had “readable” statements based on OTA standards. Privacy regulations around the world all have readability requirements, though they differ in how they define this. Regardless, organizations must understand these standards and ensure that their statements fit them, which most do not according to OTA.
- In addition to being readable, privacy statements should also include date stamps so users can see the effective date of the statement. Overall, 70% of organizations had the stamp somewhere on the page, 46% at the top, 22% at the bottom and 2% in both locations.
“Privacy regulations around the world are evolving and compliance will soon be a requirement, not a choice,” said Kenneth Olmstead, Internet Security and Privacy Analyst at the Internet Society’s Online Trust Alliance. “Within the U.S. alone, multiple states have privacy laws in motion. It’s in the best interest of all organizations to keep up-to-date on these laws as the requirements change. Protecting customer’s data will not only be an essential component of fostering loyalty and trust, but will also become necessary to avoid heavy fines.”
OTA will host a public webinar to discuss the findings on Thursday, September 26 at 1pm EDT/5PM UTC. See https://www.internetsociety.org/privacystatements for more information.
