Less than one year after the CCPA took effect, California passed another consumer privacy law: the CPRA. Here are six changes to help you understand the differences between CPRA vs. CCPA.
In 2018, the state of California passed the California Consumer Privacy Act (CCPA), a landmark piece of legislation that secured several privacy rights for California consumers.
Just over a year later, in November 2020, Californians voted to approve Proposition 24, creating the California Privacy Rights Act (CPRA) of 2020. The CPRA can be thought of as a more comprehensive version of the CCPA, updating, modifying, and extending certain rules and stipulations to increase the rights of California consumers.
Wondering what the differences are between CPRA and CCPA?
We have highlighted six key differences that we’ll explore in this post. Read on to find out the impact the CPRA may have on your organization.
Difference #1: Updated Criteria for Qualifying as a Business
Under the CPRA, an organization can classify as a business if they are a legal entity that is operated for profit, involves the collection of California consumers’ personal information (PI), determines the purposes and means of processing PI, and satisfies one or more of the following conditions:
(A) Has an annual gross revenue of over $25 million in the preceding calendar year
(B) Alone, or in combination, annually buys, sells, or shares the personal information of 100,000 or more consumers or households
(C) Derives 50% or more of its annual revenue from selling or sharing consumers’ personal information
Most notably, the CPRA doubles the CCPA’s threshold criteria of 50,000 California consumers or households within condition B. It also expands the CCPA’s definition in criteria C, including annual revenue derived from sharing PI in addition to selling it.
This change in criteria means that some small to midsize businesses that have to comply with the CCPA may not fall under the scope of the CPRA. Because the CPRA increases the number of consumers or households in criteria A (from 50,000 in the CCPA to 100,000 in the CPRA), the new law may actually reduce the number of businesses that qualify under that threshold. However, the inclusion of “sharing” related to deriving 50% or more of annual revenue from selling or sharing consumers’ personal information in criteria C may potentially increase the number of organizations that would qualify as a business under that threshold.
Difference #2: A New Category of Highly Protected Data
The CPRA introduces a new category of protected data: sensitive personal information (SPI). This concept is very similar to Article 9 of the General Data Protection Regulation (GDPR)—”Processing of special categories of personal data”—which calls for a greater level of data protection due to the sensitivity of the personal information. The addition of this new data category may require businesses to implement additional technical and operational controls to process such data and to limit the use and disclosure of SPI according to consumers’ rights under the CPRA.
The CPRA imposes specific requirements and restrictions on SPI, giving users expanded rights to control businesses’ use of their personal information. These new requirements include:
- Updated disclosure requirements
- Purpose limitation requirements
- Opt-out requirements for use and disclosure
- Opt-in consent requirements after a previously-selected Opt-out
The introduction of SPI means that businesses, as defined by the CPRA above, must be especially vigilant to protect this class of data and respond accordingly when a consumer decides to opt out. If a business intends to process consumers’ SPI as defined within Section 1798.121 and 1798.135 of the CPRA, then there are additional requirements that must be implemented. For example, businesses that store SPI must include a clear and conspicuous link on their websites titled “Limit the Use of My Sensitive Personal Information” that enables consumers to restrict the processing of their SPI.
Difference #3: New and Expanded Consumer Privacy Rights
There are five consumer privacy rights that are present in the CCPA that have been modified under the CPRA. These rights are:
- Right to Opt-Out of Third-Party Sales and Sharing: The CCPA allows consumers to opt-out of businesses selling their data. The CPRA expands this right to include the sharing of personal information, in addition to selling. The CPRA defines sharing as “disclosing, disseminating, making available, transferring, … a consumer’s personal information by the business to a third party for cross-context behavioral advertising, whether or not for monetary or other valuable consideration …”
- Right to Know: The CCPA requires that businesses respond to consumer requests to know personal information that was collected within the prior 12 months. The CPRA extends this timeline, enabling consumers to potentially request personal information collected beyond the prior 12-month window under certain circumstances.
- Right to Delete: Through the CCPA, California consumers can request that a business delete their personal information if it is no longer needed to fulfill one of the purposes listed in Cal. Civ. Code Sec. 1798.105 (e.g., security needs, debugging). The CPRA will also require businesses to send the request to delete to third parties that have bought or received the consumer’s personal information so that all parties are aware that it must be deleted, subject to some exceptions.
- Right to Data Portability: The CCPA includes a “right to know”, which means that consumers have the right to receive a copy of their personal information by mail or electronically. Now, under the CPRA, a consumer can request that a business transfer specific personal information to another entity “to the extent technically feasible, in a structured, commonly used, machine-readable format.”
- Opt-In Rights for Minors: The use of minors’ data is a general concern within the law, and the CCPA requires that businesses obtain opt-in consent to sell the personal information of a California consumer under 16 years of age. The CPRA goes one step further, mandating that businesses wait 12 months before asking a minor consumer for consent in selling or sharing their personal information after the minor has declined. It also states that the opt-in right must explicitly include the sharing of data for cross-context behavioral advertising.
In addition to expanding several of the CCPA’s consumer privacy rights, the CPRA also introduces four brand–new consumer privacy rights that are not present in the CCPA:
- Right to Correct Information: A consumer has the right to request that a business correct any inaccurate personal information.
- Right to Limit Use and Disclosure of Sensitive PI: A consumer has the right to limit the use and disclosure of their SPI to that “use which is necessary to perform the services or provide the goods reasonably expected by an average consumer who requests such goods and services.”
- Right to Access Information About Automated Decision Making: A consumer has the right to request “meaningful information about the logic involved in those decision-making processes, as well as a description of the likely outcome of the process with respect to the consumer.”
- Right to Opt-Out of Automated Decision-Making Technology: A consumer has the right to opt-out of being subject to automated decision-making processes, including profiling.
Businesses must ensure that they are prepared to comply with the CPRA’s new and expanded consumer privacy rights. They will need to develop strong processes and controls to ensure they are both capable of and prepared to respond swiftly to consumer requests. Many businesses may need to make significant changes to their existing security and privacy-related controls, hire additional personnel, or contract third-party services to help them prepare for CPRA compliance.
Difference #4: Adoption of Select GDPR Principles
The GDPR has served as a template for many new privacy regulations, including the CPRA. For example, the GDPR enforces the concepts of data minimization, purpose limitation, and storage limitation. These principles are not included in the CCPA, but they are now codified as part of the CPRA:
- Data minimization: The requirement that “a business’s collection, use, retention, and sharing of a consumer’s personal information shall be reasonably necessary and proportionate to achieve the purposes for which the personal information was collected or processed.”
- Purpose limitation: This requires that businesses “only collect consumer’s personal information for specific, explicit, and legitimate disclosed purposes, and should not further collect, use, or disclose consumer’s personal information for reasons incompatible with those purposes.”
- Storage limitation: This requirement addresses “the length of time the business intends to retain each category of personal information, including sensitive personal information, or if that is not possible, the criteria used to determine such period, provided that a business shall not retain a consumer’s personal information or sensitive personal information for each disclosed purpose for which the personal information was collected for longer than is reasonably necessary for that disclosed purpose.”
By codifying these principles explicitly in the CPRA, California has authorized the state regulator to enforce, and potentially penalize, a business’s failure to 1) reasonably limit the collection of personal information to what is necessary for the purpose for which it was collected, and 2) limit the retention of personal information to the least amount of time necessary to fulfill the purpose for which it was collected.
Difference #5: Expansion of Legally Actionable Data in a Breach
Data breaches are a serious concern for businesses of all sizes. When a breach occurs, hackers can extract sensitive information, which puts both the business and consumers at risk. In the event a data breach occurs, the CCPA gives consumers the private right to take legal action if their nonencrypted or nonredacted personal information becomes exposed because a business failed to implement reasonable security procedures and practices appropriate to the nature of the information processed. While the CPRA does not explicitly alter this right, it does add consumer login credentials to the list of personal information categories that may be actionable under the law.
Many organizations suffer as a result of a data breach, as hackers gain access to personal information and exfiltrate that data from the boundary of the system. The CPRA’s expansion of scope to include login credentials as a legally actionable personal information security breach may be a response to the wave of authentication hacks affecting consumers in recent years. In addition to more advanced layers of data encryption, many businesses may want to require multi-factor authentication as an additional security layer.
Difference #6: Creation of a New Privacy Enforcement Authority
The CCPA was originally enforced by the California Office of the Attorney General (OAG). The CPRA shifts this authority by establishing the California Privacy Protection Agency (CPPA) and granting it investigative, enforcement, and rulemaking powers.
The CPPA’s outlined role in enforcing the CPRA is a notable change from the CCPA. The codification in Section 1798.199.10 provides instruction regarding the CPPA including, “[t]he agency shall be governed by a five-member board, including the chairperson. The chairperson and one member of the board shall be appointed by the Governor. The Attorney General, Senate Rules Committee, and Speaker of the Assembly shall each appoint one member. These appointments should be made from among Californians with expertise in the areas of privacy, technology, and consumer rights.” It remains to be seen how this new agency will wield its authority, but we expect that we will see an increase in the number of investigations and enforcement actions taken by the CPPA.
Start Preparing for CPRA Compliance Today
Although all aspects of the CPRA do not take full effect until January 1, 2023, organizations that do business in California should start laying the groundwork for CPRA compliance throughout the course of 2021 and 2022. If you currently have measures for CCPA in place, now is the time to perform a gap assessment based on the information available regarding the CPRA.
To prepare for the CPRA, organizations can take proactive steps such as:
- Conducting a data-mapping exercise to identify and document what PI will fall under the scope of the CPRA.
- Updating privacy notices to reflect the new and modified consumer privacy rights and related disclosure obligations.
- Reviewing downstream data-sharing practices and informing third parties that they may be required to comply with these new regulations.
By understanding the full scope of the CPRA and designing a thoughtful roadmap toward full compliance, companies can avoid the potential impacts of non-compliance once the CPRA is fully operative.