Privacy Policy

Development

In 1995 the European Union (EU) introduced the Data Protection Directive[1] for its member states. As a result, many organizations doing business within the EU began to draft policies to comply with this Directive. In the same year the U.S. Federal Trade Commission published the Fair Information Principles[2] which provided a set of non-binding governing principles for the commercial use of personal information. While not mandating policy, these principles provided guidance of the developing concerns of how to draft privacy policies.
[edit] Fair Information Practice
Main article: FTC Fair Information Practice

The four critical issues identified in Fair Information Principles are:

Notice – data collectors must disclose their information practices before collecting personal information from consumers
Choice – consumers must be given options with respect to whether and how personal information collected from them may be used for purposes beyond those for which the information was provided
Access – consumers should be able to view and contest the accuracy and completeness of data collected about them
Security – data collectors must take reasonable steps to assure that information collected from consumers is accurate and secure from unauthorized use.

In addition the Principles discuss the need for enforcement mechanisms to impose sanctions for noncompliance with fair information practices.
[edit] Current enforcement in the United States.

The United States does not have a specific federal regulation establishing universal implementation of privacy policies. Congress has, at times, considered comprehensive laws regulating the collection of information online, such as the Consumer Internet Privacy Enhancement Act[3] and the Online Privacy Protection Act of 2001,[4] but none have been enacted. In 2001, the FTC stated an express preference for “more law enforcement, not more laws”[5] and promoted continued focus on industry self regulation.

In many cases, the FTC enforces the terms of privacy policies as promises made to consumers using the authority granted by Section 5 of the FTC Act which prohibits unfair or deceptive marketing practices.[6] The FTC’s powers are statutorily restricted in some cases; for example, airlines are subject to the authority of the Federal Aviation Administration (FAA),[7] and cell phone carriers are subject to the authority of the Federal Communications Commission (FCC).[8]

In many cases, private parties enforce the terms of privacy policies by filing class action lawsuits, which may result in settlements or judgements.

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