What is the California Consumer Privacy Act?
Takeaway: The California Consumer Privacy Act (CCPA) is a state statute designed to enhance privacy rights and consumer protection for residents of California, providing individuals with the right to know, delete, and opt-out of the sale of their personal information collected by businesses.
The California Consumer Privacy Act (CCPA) is a landmark piece of legislation that has significantly impacted the way businesses handle personal data. Effective since January 1, 2020, it's one of the most comprehensive data privacy laws in the United States, providing California residents with enhanced privacy rights and consumer protection.
The CCPA applies to businesses (including startups) that collect, process, or sell personal information of California residents and meet at least one of the following criteria:
Generate annual gross revenues exceeding $25 million.
Buy, receive, or sell the personal information of 50,000 or more consumers, households, or devices.
Earn more than half of their annual revenue from selling consumers' personal information.
The core objectives of the CCPA are to provide California consumers with the right to:
Know: Consumers have the right to request a business to disclose what personal information it collects, uses, discloses, and sells.
Delete: Consumers can request a business to delete their personal information, subject to certain exceptions.
Opt-out: Consumers can opt-out of the sale of their personal information. For minors under 16, businesses must obtain opt-in consent.
Non-discrimination: Consumers cannot be discriminated against for exercising their CCPA rights. This means a business cannot deny goods or services, charge different prices, or provide a different quality of goods or services because a consumer exercised their rights.
Complying with CCPA involves implementing specific measures to honor these consumer rights. These may include updating privacy policies, creating procedures to respond to consumer requests, and ensuring service providers that handle consumer data also comply with the law.
Non-compliance with the CCPA can result in penalties. Civil penalties can reach up to $2,500 for each unintentional violation and $7,500 for each intentional violation. Additionally, the CCPA gives consumers the right to file a lawsuit if their non-encrypted and non-redacted personal information is subject to a data breach due to a business's failure to implement reasonable security procedures and practices.
Conclusion
The CCPA represents a significant shift in data privacy regulation, emphasizing transparency and consumer control over personal data. For startups, understanding and complying with the CCPA can mitigate potential legal risks and enhance consumer trust, fostering a positive brand reputation.