August 15, 2022

FTC Takes Aim at "Commercial Surveillance"

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Key Takeaways

  • Important initiatives that may change privacy and data security practices in major ways.
  • The FTC also points to concerns about dark patterns, which coerce consumers into sharing personal data.

On August 11, the FTC released its Advanced Notice of Proposed Rulemaking, seeking public input on a host of questions relating to what it describes as "commercial surveillance"—or "the business of collecting, analyzing, and profiting from information about people"—in order to determine whether to issue a  new rule "to protect people's privacy and information in the commercial surveillance economy."    The FTC's questions are grouped into several categories, including harm to consumers, harm to children, automated systems, discrimination, consumer consent, and notice, transparency, and disclosure.  The dozens of specific questions range from broad to narrow, but they generally relate to the large amounts of data collected about consumers when they are connected to the internet.  As the FTC explains, its concerns range from data security to bias/discrimination to the inability of consumers to avoid this type of collection and processing.  The FTC also points to concerns about dark patterns, which coerce consumers into sharing personal data.

The FTC's announcement does not come as a surprise, as Chair Lina Khan has been hinting for months that action would be forthcoming.  However, the formal announcement drew quick blowback from some.  For example, Senator Marsha Blackburn (R-Tenn.), a member of the Senate Commerce Committee, stated that the proposal "is doomed to become another cautionary tale of how the left uses the regulatory state to tear down and rebuild the economy according to their own vision."  Similarly, FTC Commissioner Christine Wilson warned in her dissent that the FTC's efforts could derail the ongoing efforts to pass the bipartisan American Data Privacy Protection Act (ADPPA).

The deadline for submitting comments will be 60 days after the notice is published in the Federal Register in the coming days.  The public will also have an opportunity to share their input on these topics at a virtual public forum on September 8, 2022.  But as Commission Wilson's warning may indicate, the announcement alone could have impacts on the negotiations relating to the ADPPA even before the comment period ends.  In any event, companies should consider themselves on notice that the FTC plans to continue its focus on analytical tools, online collections, and use or sale of profiles derived from that information.

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