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[Federal Register Volume 89, Number 189 (Monday, September 30, 2024)]
[Notices]
[Pages 79596-79598]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-22379]

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FEDERAL TRADE COMMISSION

Agency Information Collection Activities; Proposed Collection; 
Comment Request; Extension

AGENCY: Federal Trade Commission.

ACTION: Notice.

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SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'') is 
seeking public comments on its proposal to extend for an additional 
three years the current Paperwork Reduction Act (``PRA'') clearance for 
information collection requirements contained in the Children's Online 
Privacy Protection Rule (``COPPA Rule'' or ``Rule''). That clearance 
expires on April 30, 2025.

DATES: Comments must be filed by November 29, 2024.

ADDRESSES: Interested parties may file a comment online or on paper, by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write ``COPPA Rule: Paperwork 
Comment, FTC File No. P155408'' on your comment, and file your comment 
online at https://www.regulations.gov by following the instructions on 
the web-based form. If you prefer to file your comment on paper, mail 
your comment to the following address: Federal Trade Commission, Office 
of the Secretary, 600 Pennsylvania Avenue NW, Suite CC-5610 (Annex J), 
Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT: James Trilling, Attorney, (202) 326-
3497, Division of Privacy and Identity Protection, Bureau of Consumer 
Protection, Federal Trade Commission, 600 Pennsylvania Avenue NW, 
Washington, DC 20580.

SUPPLEMENTARY INFORMATION: 
    Title of Collection: Children's Online Privacy Protection Rule, 16 
CFR part 312.
    OMB Control Number: 3084-0117.
    Type of Review: Extension of currently approved collection.
    Affected Public: Private Sector: Businesses and other for-profit 
entities.
    Estimated Annual Burden Hours: 17,700.
    Estimated Annual Labor Costs: $8,687,169.
    Estimated Annual Non-Labor Costs: $0.
    Abstract: The COPPA Rule, 16 CFR part 312, requires commercial 
websites and online services to provide notice and obtain parental 
consent before collecting, using, or disclosing personal information 
from children under age thirteen, with limited exceptions. The COPPA 
Rule contains certain statutorily required notice, consent, and other 
requirements that apply to operators of any commercial website or 
online service directed to children that collect personal information, 
and operators of any commercial website or online service with actual 
knowledge that they are collecting personal information from children. 
The Rule also applies to operators that have actual knowledge that they 
are collecting personal information directly from users of another 
website or online service that is directed to children. Covered 
operators must, among other things: (1) provide online notice and 
direct notice to parents of how they collect, use, and disclose 
children's personal information; (2) obtain the prior consent of the 
child's parent in order to engage in such collection, use, and 
disclosure; (3) provide reasonable means for the parent to obtain 
access to the information and to direct its deletion; and (4) establish 
procedures that protect the confidentiality, security, and integrity of 
personal information collected from children.

Burden Statement

    A. Annual Hours Burden: 17,600 hours.

I. New Entrant Operators' Disclosure Burden

    Based on public comments received by the Commission during its 2013 
COPPA Rule amendments rulemaking,\1\ FTC staff estimates that the Rule 
affects approximately 280 new operators per year.\2\ FTC staff 
maintains its longstanding estimate that new operators of websites and 
online services will require, on average, approximately 60 hours to 
draft a privacy policy and design mechanisms to provide the required 
online privacy notice and, where applicable, the direct notice to 
parents.\3\ This yields an estimated annual hours burden of 16,800 
hours (280 respondents x 60 hours).
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    \1\ 78 FR 3972, 4005 (Jan. 17, 2013).
    \2\ This consists of certain traditional website operators, 
mobile app developers, plug-in developers, and advertising networks.
    \3\ See, e.g., 80 FR 76491 (Dec. 9, 2015); 84 FR 1466 (Feb. 4, 
2019).
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II. Safe Harbor Applicant Reporting Requirements

    Operators can comply with the COPPA Rule by meeting the terms of

[[Page 79597]]

Commission approved self-regulatory program guidelines.\4\ While the 
submission of industry self-regulatory guidelines to the agency is 
voluntary, the COPPA Rule sets out the criteria for approval of 
guidelines and the materials that must be submitted as part of an 
application for approval of such self-regulatory guidelines. Based on 
industry input, FTC staff estimates that it would require, on average, 
265 hours per new safe harbor program applicant to prepare and submit 
its safe harbor proposal in accordance with Sec.  312.11(c) of the 
Rule, 16 CFR 312.11(c).\5\ Given that several safe harbor programs are 
already available to operators of websites and online services, FTC 
staff anticipates that no more than one additional safe harbor 
applicant is likely to submit a request within the next three years of 
PRA clearance. Thus, FTC staff estimates that annualized burden 
attributable to this requirement would be approximately 88 hours per 
year (265 hours / 3 years), which is rounded to 100 hours.
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    \4\ See 16 CFR 312.11(c). Approved self-regulatory guidelines 
can be found on the FTC's website at http://www.ftc.gov/privacy/privacyinitiatives/childrens_shp.html.
    \5\ See 83 FR 49557 (Oct. 2, 2018). FTC staff believes that most 
of the records submitted with a safe harbor request would be those 
that these entities have kept in the ordinary course of business. 
Under 5 CFR 1320.3(b)(2), OMB excludes from the definition of PRA 
burden the time and financial resources needed to comply with 
agency-imposed recordkeeping, disclosure, or reporting requirements 
that customarily would be undertaken independently in the normal 
course of business.
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III. Annual Audit and Report for Safe Harbor Programs

    The COPPA Rule requires safe harbor programs to audit their members 
at least annually and submit annual reports to the Commission on the 
aggregate results of these member audits. The burden for conducting 
member audits and preparing these reports likely varies by safe harbor 
program depending on the number of members. FTC staff estimates that 
conducting audits and preparing reports will require approximately 100 
hours per program per year. Aggregated for one new safe harbor (100 
hours) and six existing safe harbor (600 hours) programs, this amounts 
to an estimated cumulative reporting burden of 700 hours per year (7 
respondents x 100 hours).

IV. Safe Harbor Program Recordkeeping Requirements

    FTC staff understands that most of the records listed in the COPPA 
Rule's safe harbor recordkeeping provisions consist of documentation 
that covered entities retain in the ordinary course of business 
irrespective of the COPPA Rule. As noted above, OMB excludes from the 
definition of PRA burden, among other things, recordkeeping 
requirements that customarily would be undertaken independently in the 
normal course of business. In FTC staff's view, any incremental burden, 
such as that for maintaining the results of independent assessments 
under Sec.  312.11(d), would be marginal.
    B. Estimated Annual Labor Costs: $8,687,169.

I. New Entrant Operators' Disclosure Burden

    Consistent with its past estimates and based on its 2013 rulemaking 
record, FTC staff assumes that the time spent on compliance for new 
operators covered by the COPPA Rule would be apportioned five to one 
between legal (outside counsel lawyers or similar professionals) and 
technical (e.g., computer programmers, software developers, and 
information security analysts) personnel. FTC staff therefore estimates 
that outside counsel costs will account for 14,000 of the estimated 
16,800 hours required as estimated in Section A.I above. FTC staff 
anticipates that the workload among law firm partners and associates 
for assisting with COPPA compliance would be distributed among 
attorneys at varying levels of seniority. Assuming two-thirds of such 
work is done by junior associates at a rate of approximately $510 per 
hour, and one-third by senior partners at approximately $798 per hour, 
the weighted average of outside counsel costs would be approximately 
$606 per hour.\6\ FTC staff anticipates that computer programmers 
responsible for posting privacy policies and implementing direct 
notices and parental consent mechanisms would account for the remaining 
2,800 hours. FTC staff estimates an hourly wage of $56.03 for technical 
personnel, based on Bureau of Labor Statistics (``BLS'') data.\7\ 
Accordingly, associated annual labor costs would be $8,640,884 [(14,000 
hours x $606/hour) + (2,800 hours x $56.03/hour)] for the estimated 280 
new operators.
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    \6\ These estimates are drawn from the ``Fitzpatrick Matrix.'' 
The Fitzpatrick Matrix was developed to provide a tool for the 
``reliable assessment of fees charged for complex [civil] federal 
litigation,'' in the District of Columbia, and has been adopted by, 
among others, the Civil Division of the United States Attorney's 
Office for the District of Columbia. See Fitzpatrick Matrix, Civil 
Division of the United States Attorney's Office for the District of 
Columbia, Fitzpatrick Matrix, 2013-2024 (quoting DL v. District of 
Columbia, 924 F.3d 585, 595 (D.C. Cir. 2019)), available at https://www.justice.gov/usao-dc/media/1353286/dl?inline. It is used here as 
a proxy for market rates for litigation counsel in the Washington, 
DC area. For 2024, the Fitzpatrick Matrix sets forth estimates 
ranging from $500 per hour for the most junior associates to $864 
per hour for the most senior partners. See id. For the purpose of 
this analysis, FTC staff determined the hourly rate for work 
performed by junior associates based on the average of the 2024 
hourly rates for junior associates with zero to one year of 
experience, and the hourly rate for work performed by senior 
partners based on the average of the 2024 hourly rates for senior 
partners with more than eleven years of experience.
    \7\ The estimated mean hourly wages for technical personnel 
($56.03) is based on an average of the mean hourly wage for computer 
programmers, software developers, information security analysts, and 
web developers as reported by the Bureau of Labor Statistics. See 
Bureau of Labor Statistics, Occupational Employment and Wages--May 
2023, Table 1 (May 2023), available at https://www.bls.gov/news.release/ocwage.t01.htm (National employment and wage data from 
the Occupational Employment Statistics survey by occupation) 
[hereinafter ``BLS Table 1''].
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II. Safe Harbor Applicant Reporting Requirements

    Previously, industry sources have advised that all of the labor to 
comply with new safe harbor applicant requirements would be 
attributable to the efforts of in-house lawyers.\8\ To determine in-
house legal costs, FTC staff applied an approximate average between the 
BLS reported mean hourly wage for lawyers ($84.84),\9\ and estimated 
in-house hourly attorney rates ($300) that are likely to reflect the 
costs associated with some safe harbor applicant costs. This yields an 
approximate hourly rate of $193. Applying this hourly labor cost 
estimate to the hours burden associated with approval for a new safe 
harbor application yields an estimated annual labor cost burden of 
$19,300 (100 hours x $193).
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    \8\ See 83 FR 49558 (Oct. 2, 2018).
    \9\ See BLS Table 1 (attorneys).
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III. Annual Audit and Report for Safe Harbor Programs

    FTC staff assumes that compliance officers, at a mean hourly wage 
of $38.55, will prepare annual reports.\10\ Applying this hourly labor 
cost estimate to the hours burden associated with preparing annual 
audit reports yields an estimated annual labor cost burden of $26,985 
(700 hours x $38.55).
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    \10\ See BLS Table 1 (compliance officers, $38.55).
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IV. Safe Harbor Program Recordkeeping Requirements

    For the reasons stated in Section A.IV above, FTC staff anticipates 
that the labor costs associated with safe harbor program recordkeeping 
are de minimis.
    C. Estimated Annual Non-Labor Costs: $0.
    FTC staff understands that covered operators already have in place 
the computer equipment and software necessary to comply with the Rule's

[[Page 79598]]

notice requirements. Accordingly, the predominant costs incurred by 
operators are the aforementioned labor costs. Similarly, FTC staff 
anticipates that covered entities already have in place the means to 
retain and store the records that must be kept under the Rule's safe 
harbor recordkeeping provisions, because they are likely to retain such 
records independent of the Rule. Accordingly, FTC staff estimates that 
the capital and non-labor costs associated with Rule compliance are de 
minimis.

Request for Comment

    Pursuant to section 3506(c)(2)(A) of the PRA, the FTC invites 
comments on: (1) whether the disclosure and recordkeeping requirements 
are necessary, including whether the information will be practically 
useful; (2) the accuracy of our burden estimates, including whether the 
methodology and assumptions used are valid; (3) ways to enhance the 
quality, utility, and clarity of the information to be collected; and 
(4) ways to minimize the burden of the collection of information.
    For the FTC to consider a comment, we must receive it on or before 
November 29, 2024. Your comment, including your name and your state, 
will be placed on the public record of this proceeding, including the 
https://www.regulations.gov website.
    You can file a comment online or on paper. Due to heightened 
security screening, postal mail addressed to the Commission will be 
subject to delay. We encourage you to submit your comments online 
through the https://www.regulations.gov website.
    If you file your comment on paper, write ``COPPA Rule: Paperwork 
Comment, FTC File No. P155408'' on your comment and on the envelope, 
and mail it to the following address: Federal Trade Commission, Office 
of the Secretary, 600 Pennsylvania Avenue NW, Suite CC-5610 (Annex J), 
Washington, DC 20580.
    Because your comment will become publicly available at https://www.regulations.gov, you are solely responsible for making sure that 
your comment does not include any sensitive or confidential 
information. In particular, your comment should not include any 
sensitive personal information, such as your or anyone else's Social 
Security number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. You are also 
solely responsible for making sure that your comment does not include 
any sensitive health information, such as medical records or other 
individually identifiable health information. In addition, your comment 
should not include any ``trade secret or any commercial or financial 
information which . . . is privileged or confidential''--as provided by 
section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 
16 CFR 4.10(a)(2)--including, in particular, competitively sensitive 
information, such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must (1) be filed in paper form, (2) be clearly labeled 
``Confidential,'' and (3) comply with FTC Rule 4.9(c). In particular, 
the written request for confidential treatment that accompanies the 
comment must include the factual and legal basis for the request and 
must identify the specific portions of the comment to be withheld from 
the public record. See FTC Rule 4.9(c). Your comment will be kept 
confidential only if the General Counsel grants your request in 
accordance with the law and the public interest. Once your comment has 
been posted publicly at www.regulations.gov, we cannot redact or remove 
your comment unless you submit a confidentiality request that meets the 
requirements for such treatment under FTC Rule 4.9(c), and the General 
Counsel grants that request.
    The FTC Act and other laws that the Commission administers permit 
the collection of public comments to consider and use in this 
proceeding as appropriate. The Commission will consider all timely and 
responsive public comments that it receives on or before November 29, 
2024. For information on the Commission's privacy policy, including 
routine uses permitted by the Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Josephine Liu,
Assistant General Counsel for Legal Counsel.
[FR Doc. 2024-22379 Filed 9-27-24; 8:45 am]
BILLING CODE 6750-01-P
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