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April 23, 2014

FTC Updates Rule for Children's Online Privacy Protection

The U.S. federal law known as the Children’s Online Privacy Protection Act (COPPA), 15 U.S.C. §§ 6501-6508, requires that commercial website and online service operators provide parental notification and obtain verifiable parental consent prior to collecting personal information from children under 13.  (Note: all references to “children” hereinafter refer to children under 13.)  After COPPA was enacted in 1998, the Federal Trade Commission (FTC) promulgated the Children’s Online Privacy Protection Rule (the COPPA Rule), 16 C.F.R. Part 312, to implement COPPA.  In 2010, the FTC began the process of updating the COPPA Rule to address changing technology in the way information about children is collected online, including the increased use of mobile devices and social media.  After seeking and considering several rounds of public comments, the FTC adopted the amended COPPA Rule on December 19, 2012.  The amended COPPA rule, which will take effect on July 1, 2013, makes several notable changes:

  • Expands the definition of “personal information” to include geolocation information, a child’s photo or audio or video file, screen or user names, and persistent identifiers (e.g., a customer number held in a cookie, an IP address, a unique mobile device ID, etc.) that can be used to identify a user over time and across different websites or online services
  • Holds an online service operator liable for third-party collection of personal information on its platform, if the third party is acting on behalf of the operator (e.g., as an agent or service provider) or if the operator benefits by allowing the third party to collect information from users on its platform
  • Makes a party (e.g., a software plug-in or an ad network) that collects information on another’s platform liable under COPPA, if that party has actual knowledge it is collecting personal information on a children-directed platform
  • Further clarifies the test for determining whether an online service is children-directed (which remains a highly fact-specific inquiry that depends on the totality of the circumstances)
  • Adds an age-screening safe harbor for online services that fit the “directed to children” criteria, but do not target children as their primary audience
  • Streamlines what disclosures need to be made in an online service’s parental notification and privacy policy/notice regarding its information practices with respect to children
  • Expands acceptable methods for obtaining verified parental consent

With these changes, the amended COPPA Rule enhances online privacy protection for children and makes online service operators more accountable for data collection activities involving children.  To ensure compliance with the amended COPPA Rule, online service operators—including websites, mobile app operators, social media plug-in providers and ad networks—need to evaluate their data collection activities with respect to children, including third-party activities on their platforms as well as their activities on third-party platforms.

© 2014 McDermott Will & Emery

About the Author

Partner

Han (Jason) Yu is a partner in the law firm of McDermott Will & Emery LLP and is based in the Firm’s Los Angeles office.  He focuses his practice on intellectual property protection, rights clearance, licensing, internet and digital media, promotion & advertising, and entertainment law matters.

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