Antitrust Law Daily Wrap Up, PRIVACY NEWS: Commissioner Brill urges U.S., EU collaboration in protecting global privacy rights, (Dec 12, 2013)

By Linda O’Brien, J.D., LL.M.

FTC Commissioner Julie Brill discussed the future course of industry, regulators, and government in the development of ways to both protect consumer privacy and spur innovation in a speech on December 11 before the International Association of Privacy Professionals’ Europe Data Protection Congress in Brussels, Belgium.

Brill began her keynote address, entitled “At the Crossroads,” by contemplating that the world of privacy is at a crossroads in its path to protect important privacy rights. One way that companies can address privacy issues raised by business products and services and develop appropriate privacy practices is to study the work of the FTC, particularly for U.S. and European companies that intersect with the U.S. regulatory regime.

The FTC has a very broad mandate to engage in competition and consumer protection enforcement across the economy, according to Brill. The Commission has become the leading privacy regulator in the U.S. by building a robust data protection and privacy enforcement program that focuses on traditional products and services as well as the evolving digital and mobile marketplace. The FTC uses its authority to stop unfair or deceptive practices that infringe on consumers’ privacy or place consumer data at risk, and vigorously enforce laws that protect consumers’ financial and health information.

Brill stated that the FTC has also used its broad enforcement authority to challenge inappropriate privacy and data security practices of well-known and lesser-known companies, and has obtained millions of dollars in penalties and restitution. Many of the FTC’s privacy and data security enforcement actions have a global impact, protecting consumers in the U.S., European Union (EU), and around the world.

As a complement to its privacy enforcement work, the FTC is actively engaged in policy development to improve privacy protection in this age of rapid technological changes, Brill continued. Two new emerging technologies—Big Data analytics and the Internet of Things—have the potential to accelerate data collection and use it in ways that are not transparent to consumers and could cause harm. Brill has urged businesses to (1) provide consumers with innovative tools to increase transparency of practices using these new technologies, (2) provide consumers with more effective choice mechanisms, and (3) better protect sensitive information.

Brill has made specific recommendations in two areas. The first is an initiative called “Reclaim Your Name” which urges data brokers to (1) help consumers find out how the data is collected and used; (2) give consumers access to information that data brokers have compiled about them; (3) allow consumers to opt out if a data broker is selling their information for marketing purposes; and (4) provide consumers with the opportunity to correct errors in information used for substantive purposes. The second involves the world of connected devices—the Internet of Things—and how privacy laws should be applied to products where the consumer may not realize that he or she has a device that collects personal information. Brill has encouraged companies to embrace privacy by design and build in protections that ensure the connected devices collect only the data necessary to function and that the data is held securely for the minimum time necessary.

Brill next addressed how the U.S. and EU can work together to meet the challenge of both protecting consumer privacy and spurring innovation. Although the U.S. and EU share a common goal of protecting consumer privacy, their approaches may be different. Brill highlighted the need for the U.S. and EU to develop and preserve existing mechanisms that facilitate the flow of information across borders, while at the same time protect consumer privacy. The U.S.-EU Safe Harbor Framework is an example of one important method of achieving this goal.

The FTC has vigorously enforced the Safe Harbor and opened numerous investigations into Safe Harbor compliance. Brill acknowledged recent criticism of Safe Harbor due to revelations about government surveillance that has created tensions in the transatlantic relationship. However, consumer privacy in the commercial sphere and a citizen’s privacy in light of government surveillance to protect national security are two distinctly separate issues, in Brill’s view. As an alternative to suspending or renegotiating Safe Harbor, Brill believes that there are three areas that could enhance the Safe Harbor program: (1) more accessible and affordable Alternate Dispute Resolution mechanisms; (2) increased transparency in the administration of the Safe Harbor program; and (3) strengthened accountability for companies engaged in cross-border data transfers.

Brill concluded that she remains hopeful that the U.S. and EU can work together to address the three highlighted areas to implement practical improvements that would “enhance privacy protections and trust on both sides of the Atlantic.” As the U.S. and EU stand at the crossroads, Brill urged a path where new technologies thrive and longstanding privacy principles are embraced, and “where national governments celebrate their shared values and respect their differences.”

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