Meet Privacy Law Regulations and Succeed with the Right Legal Counsel
Definitions of privacy vary widely according to the context and environment. Generally speaking, the concept has been fused with the concept of data protection, which tends to view privacy through the prism of the management of personal information. Privacy law refers to those laws that regulate the collection, manipulation, storage, and use of the personal information of individuals by both the public and private sector. Failing to comply with federal and foreign privacy laws may lead to stiff penalties. A privacy law firm can help ensure compliance to mitigate risks and avoid exposure to legal penalties, which is an ever growing risk to clients.
For historical reasons, privacy law has evolved less in the United States than it has in many developed countries, particularly the European Union, which has both privacy and data protection directives, and in Canada. The United States has taken a relatively laissez-faire attitude toward privacy relative to other jurisdictions, which has led certain commentators to conclude that in the United States, consumers have no privacy. However, there are certain areas where personal information, its dissemination and use are tightly regulated in the United States. Those areas are in the healthcare field, where the HIPAA legislation must be understood (Health Insurance Portability and Accountability Act of 1996), and in the area of financial services, where the Graham-Leach-Bliley Act requires financial institutions – companies that offer consumers financial products or services like loans, financial or investment advice, or insurance – to explain their information-sharing practices to their customers and to safeguard sensitive data.
In addition, under US law, children’s privacy is given special protection as a result of The Children’s Online Privacy Protection Act of 1998 (COPPA), a United States federal law. The Act, which took effect in 2000, applies to the online collection of personal information by persons or entities under U.S. jurisdiction from children under 13 years of age.
European countries and Canada are far more stringent about the treatment of personal information, regardless of whether it is financial or related to health, and therefore, multinational companies often cannot transfer any personal data from servers located in the European Union to servers located in the United States, because of the European perspective that the US affords inadequate privacy protection to individuals, unless the company has complied with the Commerce Department’s “safe harbor” provisions under US law.
For many companies, collecting sensitive employee and consumer information is an essential part of doing business. Privacy laws regulate the collection, use, transfer, and disclosure of personally identifiable information (PII). PII may be crucial for many aspects of a company’s operation and refers to information such as: home addresses, unlisted phone numbers, name of spouses, employment history, salary, and race or national origin. These laws, which are enacted at a state, national, and international level, create a complex network of regulations which may affect numerous aspects of a company’s activities. If a company collects this type of information, it is that company’s legal responsibility to take steps to properly secure or dispose of the data.
Most companies, especially online business, post privacy policies that describe how consumers’ personal information is collected, used, shared and secured. A company’s privacy policies should reflect the company’s actual needs and practices. Once privacy policies are put into place a company needs to make sure it follows them by implementing reasonable security measures and conducting evaluations of ongoing PII security. Failure to do so can result in legal issues, legal action, and in the worst case, data breaches with the substantial legal costs that may result.
As mentioned above, outside the United States, numerous countries have strict privacy laws that affect a company’s local operations and the trans-border transfer of personal information. For example, a U.S. company doing business in Europe must meet the specific privacy requirements of a given member state of the European Union, as well as those in the United States. Given this complex legal, regulatory, and judicial landscape, companies should value the benefits of working with a qualified privacy lawyer. Having effective legal counsel can help a company meet their privacy law obligations, not only to protect the sensitive information of customers and consumers but also the company’s interests.