Source: http://www.klgateshub.com/details/?pub=Frequently-Asked-Questions-About-the-California-Consumer-Privacy-Act-of-2018-CCPA-07-31-2018
Timestamp: 2019-04-24 07:52:28+00:00

Document:
Following are answers to common questions our clients have asked since CCPA was enacted. Please check back for new and updated FAQs in the coming months.
FAQ 1: WHY DID THE CALIFORNIA LEGISLATURE ENACT CCPA?
CCPA was first introduced in the California legislature in February 2017. The early version of CCPA focused on cable and Internet service companies because “Congress and the Trump administration effectively halted a set of federal consumer privacy protection rules on Internet service providers that were scheduled to take effect.” After a series of committee reviews and amendments in April, June and September, the emphasis on cable and internet service companies lessened and CCPA was moved to the inactive file on September 16, 2017.
By May 3, 2018, proponents of the Ballot Initiative announced that they had sufficient signatures to add the Ballot Initiative to California’s November 2018 statewide general election. The Ballot Initiative was opposed, however, by a coalition of businesses called “Committee to Protect California Jobs,” which characterized the Ballot Initiative as “limiting [our] choices, hurting [our] businesses, and cutting [our] connection to the global economy.” Meanwhile, after eight months as an inactive file, CCPA was resurrected on June 21, 2018 and amended so that, by its terms, it only would take effect if the Ballot Initiative were withdrawn. The Ballot Initiative’s proponents agreed to withdraw the Ballot Initiative, and a week after its resurrection, CCPA became law on June 28, 2018.
CCPA is consistent with California’s history of actively protecting its residents’ privacy rights. In 2004, the California Online Privacy Protection Act (“CalOPPA”) went into effect as the first US state law requiring website operators to post privacy policies describing their information handling practices. Like CalOPPA, CCPA is focused on protecting California residents by requiring notice about a business’s personal information handling practices. CCPA regulates an entity “that does business” in California and meets specified thresholds (albeit low ones, as described below). CalOPPA is not limited to California businesses ─ CalOPPA applies to any operator of a “Web site located on the Internet or an online service” that collects and maintains personal information from a California resident who uses or visits the Web site or online service. CCPA’s scope is significantly broader: CCPA has a more expansive definition of personal information than CalOPPA and applies to “collection and sale of all personal information” by a covered business, not just personal information collected online.
FAQ 2: WHO RECEIVES NEW RIGHTS UNDER CCPA? WHAT IS A “CONSUMER”?
FAQ 3: WHAT IS THE DEFINITION OF “PERSONAL INFORMATION” TO WHICH CCPA APPLIES?
CCPA defines “personal information” as information that “identifies, relates to, describes, is capable of being associated with, or could reasonably be linked, directly or indirectly, with a particular consumer or household.” This definition is broader than the Federal Trade Commission’s definition of personal information and similar in scope to the definition of personal data under GDPR.
FAQ 4: WHAT INFORMATION IS EXCLUDED FROM CCPA’S DEFINITION OF PERSONAL INFORMATION?
CCPA’s definition of personal information excludes “publicly available information,” which means information “lawfully made available from federal, state, or local government records, if any conditions associated with such information” but excludes biometric information collected without the consumer’s knowledge and personal information used for a purpose different from the one for which the data is maintained and made available in the government records or otherwise publicly maintained.
sold to or from a consumer reporting agency (as defined in the Fair Credit Reporting Act) when the personal information is “reported in, or used to generate,” a consumer credit report.
FAQ 5: WHAT BUSINESSES MUST COMPLY WITH CCPA? DOES CCPA APPLY TO NON-PROFITS?
California is the world’s fifth largest economy, and as a result CCPA covers a large number of businesses inside and outside California. It is unclear at this point whether the $25,000,000 threshold encompasses worldwide or only California annual gross revenue. And, as drafted, the economic thresholds will sweep in many small businesses that do not meet the $25,000,000 gross revenue threshold. Any entity that controls or is controlled by a business and shares common branding with a business that meets the above criteria also is subject to CCPA.
A non-profit entity is not subject to CCPA because it does not operate “for the profit or financial benefit” of its owners.
A “covered entity” subject to the Health Insurance Portability and Accountability Act of 1996 is not subject to CCPA with respect to the protected health information (“PHI”) that it collects from a consumer but could be subject to CCPA for any personal information (as defined in CCPA) collected that is not PHI.
FAQ 6: WHAT NEW RIGHTS DO CONSUMERS RECEIVE UNDER CCPA?
The right to know has two main components.
The first right-to-know component relates to personal information that is collected or sold or disclosed about a specific consumer.
the categories of third parties with whom or which the personal information is shared.
When a business sells or discloses for a business purpose personal information about a consumer, the business also must disclose to the consumer the categories of personal information sold or disclosed for a business purpose about him or her and the parties to whom or which each category of personal information was sold.
separate lists of the categories of personal information sold and disclosed during the preceding 12 months or a statement that no sale or disclosure was made.
Neither right-to-know requirement mandates a business to retain information collected for a single transaction or to link de-identified information to personal information unless, in either case, the business’ usual practice is to do so.
A consumer can request a copy of the specific personal information that a business retains about him or her. Upon receipt of a verifiable consumer request for access, the business must provide the “specific pieces of personal information” that it retains about the consumer. The business must provide the personal information free of charge either through the consumer’s “account” with the business or, at the consumer’s option, by mail or in a readily usable electronic format “that allows the consumer to transmit the information to another entity without hindrance.” The business is obligated to respond to no more than two right-to-access requests in a 12-month period. The right to access does not apply to information collected for a single transaction as long as the information is not sold or retained for the purpose of linking it to personal information.
As with the right to know, a business is not required to retain information collected for a single transaction or to link de-identified information to personal information unless, in either case, the business’ usual practice is to do so.
A consumer may submit and a business must honor a verifiable consumer request for deletion of any personal information that the business has collected from the consumer. The business also must ensure that its service providers delete the consumer’s personal information.
for lawful internal uses that are compatible with the context in which the consumer provided the personal information to the business.
A consumer may use a right to opt out to instruct a business that sells personal information not to sell the consumer’s personal information. Once a consumer opts out, the business must honor the opt-out request for at least 12 months, but subsequently may sell the consumer’s personal information if the consumer provides his or her “express authorization”.
train “all individuals responsible for handling consumer inquiries” about the opt-out right and how a consumer can exercise the right to opt out.
The right to opt out applies to consumers age 16 and older.
under age 13 unless a parent or legal guardian has “affirmatively authorized” the sale.
Like CCPA, COPPA has an actual knowledge qualifier. COPPA applies to an Internet-connected service for a general audience, i.e., not directed to children, only if its operator has “actual knowledge” that children are providing personal information on or through the Internet-connected service. In practice, many operators of general-audience online services state in their privacy policies that the service is not directed to children under age 13 and that children under age 13 are not permitted to use it ─ and purposefully do not ask about users’ ages to avoid actual knowledge.
The right to equal service is intended to prevent a business from discriminating against a consumer who uses the rights granted by CCPA. For example, a business cannot deny goods or services to a consumer, charge a consumer a different price, provide different or lower-quality goods or services to a consumer, or suggest a consumer will experience any of the foregoing simply because the consumer exercised his or her CCPA right to opt out.
CCPA does, however, permit a business to offer different products or services if the difference is “reasonably related” to the value of the consumer’s data. A business also may offer financial incentives to a consumer – including better quality or service levels or more favorable pricing ─ in exchange for the collection, sale or deletion (or absence of deletion) of his or her personal information if the better quality, service or pricing is “directly related” to the value of the consumer’s data. The consumer must, however, opt into ─ and have the right to opt out of ─ the “financial incentive program” after notice of the program’s material terms.
The California Attorney General’s regulations “necessary to further the purposes” of CCPA are expected to explain how to determine the value of consumer data and the difference between “reasonably related” value for price and quality differences and “directly related” value for financial incentives. In the meantime, as part of preparing for CCPA, businesses may wish to explore charging fees for products or services that were previously offered for free in order to offset the direct and indirect costs of CCPA compliance.
FAQ 7: How Is a Sale of Personal Information Different From a Disclosure for a “Business Purpose”?
CCPA defines “sell” broadly to include any communication or transfer of consumer’s personal information by a CCPA-covered business to a third party “for monetary or other valuable consideration.” Disclosing personal information for a “business purpose” is different because the disclosure is for one of the enumerated “operational” purposes (described below) of the CCPA-covered business or its service provider.
when a transfer of personal information that is part of a merger, acquisition, bankruptcy, or other transaction in which a third party assumes control of the business (in whole or part), if the transferee continues to honor the right to know and right to access, including notifying consumers in advance if the transferee will use or share the personal information in a new or different way.
verifying or maintaining quality or safety or improving or upgrading a service or device owned, manufactured or controlled by or for the business.
Any use of personal information for a business purpose must be reasonably necessary for, and proportionate to, the purpose for which the personal information is first processed or another contextually “compatible” operational purpose.
FAQ 8: What Is a “Verifiable Consumer Request” and How Does a Business Respond to One?
CCPA defines a “verifiable consumer request” (“VCR”) as a request made by or on behalf of a consumer to exercise his or her CCPA rights for which a business can reasonably verify the identity of the consumer or the consumer’s representative.
For the right to know and right to opt out, a CCPA-covered business must offer at least two methods for VCR submission. One of these two methods must be a toll-free number and the other a website address (if the business has a website). A business is required to respond to only two (2) requests from the same consumer over a 12-month period. The VCR process must be free of charge to the consumer.
For any VCR, the business must respond in writing either through the consumer’s account with the business if the consumer maintains an account with the business or, if the consumer does not maintain an account with the business, the consumer’s choice of mail or electronic communication. Once a consumer has submitted the VCR, the business has 45 days to respond and, as long as the business notifies the consumer within the first 45 days that additional time is needed, up to 45 more days (or a total of 90 days). The response to the VCR must cover the 12-month period preceding the date on which the business received the VCR.
By June 28, 2019, the California Attorney General is required to adopt regulations to help businesses determine when a request is a VCR. CCPA deems a consumer’s request “submitted through a password-protected account maintained by the consumer with the business while the consumer is logged into the account” as a VCR. But, a business may not require a consumer to create an account in order to submit a VCR.
FAQ 9: How Does CCPA Apply To A Service Provider That Processes Personal Information For A CCPA-Covered Business?
A “service provider” is a for-profit entity that processes information on behalf of a CCPA-covered business. CCPA requires that the business (i) enter into a written contract with the service provider prohibiting the service provider from undertaking any processing of the personal information other than for the specific purpose of performing the services specified in the written contract and (ii) obtain “certification” that the service provider understands these restrictions. When requested, the service provider must delete personal information it processes for the CCPA-covered business, subject to the same exceptions to the right to delete as the covered business.
The service provider is liable for its own violations of CCPA, and the business that discloses the personal information to the service provider also will be liable for the service provider’s CCPA violations if the business had “actual knowledge or reason to believe” that the service provider intended to violate CCPA.
FAQ 10: Does CCPA Have Exceptions?
collect or sell personal information when “every aspect of that commercial conduct takes place wholly outside of California” ─ that is, CCPA does not apply if all personal information was collected while the person to whom the personal information relates was outside of California and no part of the sale of the personal information occurred in California.
CCPA also does not apply if compliance would violate evidentiary privileges given under California law.
FAQ 11: What Are The Penalties For Violating CCPA? Does CCPA Have a Private Right Of Action?
The California Attorney General enforces CCPA, except that CCPA offers only a private right of action for “unauthorized access and exfiltration, theft, or disclosure” (i.e., a data breach).
a business, service provider or other person that intentionally violates CCPA is liable for a civil penalty of up to $7,500 per violation.
If the business cures the alleged violation and provides the consumer “an express written statement that the violations have been cured and that no further violations shall occur,” the consumer cannot proceed with the lawsuit.
If the business continues with its alleged violations, the consumer can file a lawsuit for the original, and any new, CCPA violation, including breaching the written statement.
No notice is required if the consumer suffered actual pecuniary damages as a result of the business’ failure to implement and maintain reasonable security procedures.
FAQ 12: What Are The Key Similarities Between CCPA and GDPR?
1. CCPA and GDPR both view the privacy of personal information as a fundamental right.
2. Both laws broadly define what is “personal,” although CCPA’s definition of personal information includes a reasonableness qualifier.
"purchasing or consumer tendencies”; all of which are quite broad and indefinite.
Both laws have similarly defined the term for doing something with personal information ─ “processing” ─ as any operation performed on personal data, whether automated or otherwise.
3. Like GDPR, CCPA offers individuals some rights to control how their personal information is used and disclosed.
receive collected personal information that a business has free of charge by mail or in a readily usable electronic format that allows the consumer to transmit the information to another entity.
request that personal data be transferred to another data controller or provided in a format that will permit such a transfer.
4. Both CCPA and GDPR recognize the need for businesses to conduct due diligence on the third parties that assist them with personal information processing and to have the arrangements memorialized in a contract.
up to 20,000,000 EUR or up to 4% of total worldwide annual turnover of the previous year, whichever is greater, for violations of data protection principles, consent, data subjects rights and cross-border data transfer requirements.
 See AB375 dated February 9, 2017, https://leginfo.legislature.ca.gov/faces/billVersionsCompareClient.xhtml?bill_id=201720180AB375&cversion=20170AB37599INT.
 California law permits eligible California voters to bypass the legislative process by submitting the text of a new law to the California Attorney General. If the “proponents” of the new law obtain the required minimum number of signatures, the proposed law is added to the ballot for the next general election. CAL. ELEC. CODE § 9000 et seq.
 The Ballot Initiative was organized by Californians for Consumer Privacy and is available at https://oag.ca.gov/system/files/initiatives/pdfs/17-0039%20%28Consumer%20Privacy%20V2%29.pdf.
 The California Attorney General summarized the Ballot Initiative as: “Gives consumers right to learn categories of personal information that businesses collect, sell, or disclose about them, and to whom information is sold or disclosed. Gives consumers right to prevent businesses from selling or disclosing their personal information. Prohibits businesses from discriminating against consumers who exercise these rights. Allows consumers to sue businesses for security breaches of consumers’ data, even if consumers cannot prove injury. Allows for enforcement by consumers, whistleblowers, or public agencies. Imposes civil penalties. Applies to online and brick-and-mortar businesses that meet specific criteria.” See https://oag.ca.gov/system/files/initiatives/pdfs/Title%20and%20Summary%20%2817-0039%29_0.pdf.
 The Ballot Initiative needed 365,880 signatures and 629,000 were obtained.
 Sponsored by the California Chamber of Commerce and a Coalition of Innovation Companies, Committee Major Funding from AT&T, Google and Facebook.
 See “Statement By The Committee To Protect California Jobs On Submission Of Signatures For Internet Regulation Ballot Measure,” (May 3, 2018), https://californianewswire.com/statement-by-the-committee-to-protect-california-jobs-on-qualification-of-signatures-for-internet-regulation-ballot-measure/.
 CAL. CIV. CODE § 1798.198(b).
 CAL. BUS. & PROF. CODE §§ 22575–22579. Notably, CalOPPA is part of California’s Business Code because CalOPPA regulates businesses that operate websites that collect personal information, whereas CCPA is part of its Civil Code, which reflects CCPA’s emphasis on consumer rights.
 California has several other laws, including California Civil Code § 1798.83 (known as the “Shine the Light” law), which requires a business collecting personal information from its California customers and disclosing it to “third parties” for direct marketing purposes to take certain steps to inform customers of this practice and Privacy Rights for California Minors in the Digital World (CAL. BUS. & PROF. CODE §§ 22580–22582), which requires websites that are directed to or known to be used by California minors to offer a process for California minors to remove (or have removed) their own posted content and information.
 CAL. BUS. & PROF. CODE § 22577(c).
 CAL. CIV. CODE § 1798.140(g).
 18 CA ADC § 17014.
 CAL. CIV. CODE § 1798.140(o).
 “…information reasonably linked to a specific consumer, computer or other device.” See Protecting Consumer Privacy in an Era of Rapid Change: Recommendations for Businesses and Policymakers (March 2012), https://www.ftc.gov/sites/default/files/documents/reports/federal-trade-commission-report-protecting-consumer-privacy-era-rapid-change-recommendations/120326privacyreport.pdf.
 Unique identifier means a persistent identifier that can be used to recognize a consumer, a family, or a device (another defined term (CAL. CIV. CODE § 1798.140(j))) that is linked to a consumer or family, over time, and across different services, including, but not limited to, a device identifier; an Internet protocol address; cookies, beacons, pixel tags, mobile ad identifiers, or similar technology; customer number, unique pseudonym, or user alias; telephone numbers; or other forms of persistent or probabilistic identifiers (yet another defined term (§ 1798.140(p))) that can be used to identify a particular consumer or device.
 CAL. CIV. CODE § 1798.140(o)(2).
 CAL. CIV. CODE § 1798.140(h).
 CAL. CIV. CODE § 1798.140(a).
 15 U.S.C. §§ 6801–6809. Among other requirements, the Gramm-Leach-Blilely Act requires financial institutions (i.e., banks and securities firms as well as real estate appraisers; check printing, money wiring, check cashing, tax preparation, and credit counseling businesses; insurance underwriters and mortgage brokers (16 C.F.R. §313.3(k)) to provide notice about the procedures and policies implemented for protecting the privacy of non-public personal information, which is personally identifiable financial information that a financial institution obtains from or about an individual in connection with a financial product or service that is not publicly available.
 18 U.S.C. §2721 et seq. The Driver’s Privacy Protection Act prohibits the disclosure of drivers' personal information in a motor vehicle record by state departments of motor vehicles except for the uses listed in such Act.
15 U.S.C. § 1681 et seq. The Fair Credit Reporting Act enacted procedures to ensure “accuracy and fairness of credit reporting” and thereby ensure “a respect for [a] consumer’s right to privacy.” 15 U.S.C. § 1681(a).
 CAL. CIV. CODE § 1798.145(d).
 “Processing” under CCPA means any operation or set of operations performed on personal information. CAL. CIV. CODE § 1798.140(q).
 CAL. CIV. CODE § 1798.140(c).
 Thomas Fuller, The Pleasure and Pain of Being California, the World’s 5th-Largest Economy, N.Y. TIMES (May 7, 2018), https://www.nytimes.com/2018/05/07/us/california-economy-growth.html.
 CAL. CIV. CODE § 1798.140(c)(1).
 Covered entities are health plans, most health care providers and health care clearinghouses and their “business associates” (i.e., the third parties that support covered entities).
 PHI is individually identifiable health information created or received by a covered entity.
 Also referred to as a “verifiable consumer request” which is defined in CAL. CIV. CODE § 1798.140(y) and subject to “regulations adopted by the Attorney General.” See FAQ 9.
 CAL. CIV. CODE §§ 1798.110, 130(a)(3)(B).
 CAL. CIV. CODE § 1798.100(a)(1), 110(a)(5).
 CAL. CIV. CODE § 1798.100(a)(2).
 Business purpose” is defined in 1798.140(d) as operational purposes reasonable and necessary for the purposes for which the personal information was collected. A “commercial purpose” as defined in 1798.140(f) is to advance the business’ “commercial or economic interests” by “inducing” directly or indirectly a “commercial transaction” but excluding “noncommercial speech” such as “political speech and journalism.” See also FAQ 8.
 CAL. CIV. CODE § 1798.100(a)(3).
 CAL. CIV. CODE § 1798.100(a)(4).
 See FAQ 8: WHAT IS A “VERIFIABLE CONSUMER REQUEST” AND HOW DOES A BUSINESS RESPOND TO ONE?.
 CAL. CIV. CODE § 1798.115.
 CAL. CIV. CODE § 1798.130(a)(5).
 CAL. CIV. CODE § 1798.100(c).
 CAL. CIV. CODE § 1798.130(a)(5)(A).
 CAL. CIV. CODE § 1798.130(a)(5)(B).
 CAL. CIV. CODE § 1798.130(a)(5)(C).
 CAL. CIV. CODE §§ 1798.100(e), 110(d).
 CAL. CIV. CODE § 1798.130(a)(2).
 CAL. CIV. CODE § 1798.100(d).
 CAL. CIV. CODE § 1798.100(e).
 CAL. CIV. CODE § 1798.105.
 CAL. CIV. CODE § 1798.140(v). A “service provider” has a written contract with the business receiving the request and receives and processes (defined in CAL. CIV. CODE § 1798.140(q)) personal information on behalf of the business. See also FAQ 9: HOW DOES CCPA APPLY TO A SERVICE PROVIDER THAT PROCESSES PERSONAL INFORMATION FOR A CCPA-COVERED BUSINESS?.
 Cal PEN CODE § 1546 et seq. The California Electronic Communications Privacy Act applies to California governmental agencies (including law enforcement) that collect electronic communications information..
 “Research” is a defined term. CAL. CIV. CODE § 1798.140(s).
 CAL. CIV. CODE § 1798.130(a).
 CAL. CIV. CODE § 1798.120(c).
 "Homepage" means “introductory page of an Internet website and any Internet web page where personal information is collected. In the case of an online service, such as a mobile application, homepage means the application’s platform page or download page, a link within the application, such as from the application configuration, “About,” “Information,” or settings page, and any other location that allows consumers to review the notice required by subdivision (a) of Section 1798.145 [sic], including, but not limited to, before downloading the application.” CAL. CIV. CODE § 1798.140(l).
 CAL. CIV. CODE § 1798.135(b).
 CAL. CIV. CODE § 1798.135(a)(2)(B).
 CAL. CIV. CODE § 1798.120(d).
 The FTC interprets “website or online service” broadly to mean “any service available over the Internet or that connects to the Internet or a wide-area network.” COPPA’s definition applies not only to websites and mobile applications, but also to plug-ins, widgets, advertising networks and voice over Internet protocol, or VOIP, services. The FTC interprets “website or online service” broadly to mean “any service available over the Internet or that connects to the Internet or a wide-area network.” See Federal Trade Commission, Complying with COPPA: Frequently Asked Questions, Question 9.
 Under COPPA, several factors are considered, including the digital service’s subject matter, visual and audio content, the use of animated characters or other child-oriented activities and incentives, the age of models or celebrities who appeal to children, as well as other reliable evidence about the composition of the actual or intended audience. 15 U.S.C. § 6502(b).
 CAL.CIV. CODE §1798.140(h). As noted above, personal information is de-identified only if cannot be directly or indirectly linked to a particular consumer and re-identification is prevented by technical and business processes.
 “Aggregate consumer information” is information that relates to a group or category of consumers, from which individual consumer identities have been removed and is not reasonably linkable to a consumer, household or device. §1798.140(a).
 CAL.CIV. CODE §1798.155(a) (citing Section 17206 of the Business and Professions Code).
 CAL.CIV. CODE §1798.140(q), GDPR Article 4(8).
 CAL.CIV. CODE §1798.140(q),. GDPR Article 4(2).
 CAL.CIV. CODE §1798.140(q), GDPR Article 28.

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