What happened?

On December 20, 2023, The Federal Trade Commission (FTC) proposed changes to the COPPA Rule that would place new restrictions on the use and disclosure of children’s personal information and further limit the ability of companies to condition access to services on monetizing children’s data, aiming to shift the burden from parents to providers.

What are the details?

The FTC is a federal agency that enforces federal consumer protection laws that prevent fraud, deception, and unfair business practices.

The FTC is seeking comments on a revised proposal to the COPPA Rule aimed at addressing the evolving ways personal information is being collected, used, and disclosed, including monetization of children’s data, and clarifying and streamlining the rule. 

Some key changes proposed are:

1. Expanded definition of personal information
2. Limits on data retention
3. New factors added to “directed to children” test
4. Updated notice, consent requirements, and exceptions
5. Increasing accountability for Safe Harbor programs
6. New data security requirements

The Proposed Rule is expected to be published soon, and interested parties have 60 days to submit their comments after publication.

Business Considerations

• Plan to update your policies, practices, and procedures according to the revised proposed rules.

During a comment period, your business has the opportunity to influence amendments to the proposed rule that may benefit your organization. Review the rule and if interested, share your feedback during the comment period.

Resources

• FTC Proposes Strengthening Children’s Privacy Rule to Further Limit Companies’ Ability to Monetize Children’s Data (Federal Trade Commission)
• Proposed Text for Federal Register publication

Source References

• Statement of Commissioner Alvaro M. Bedoya On the Issuance of the Notice of Proposed Rulemaking to Update the Children’s Online Privacy Protection Rule (COPPA Rule) (Federal Trade Commission)
• FTC Proposes Significant Changes to COPPA Rule (Wilson Sonsini Goodrich & Rosati.)
• FTC’s Proposed Updates to the COPPA Rule Seek to Impose New Limitations on the Use of Children’s Personal Information and New Compliance Obligations on Businesses (Fenwick & West LLP)
• FTC Approves NPR Updating the COPPA Rule (The National Law Review – National Law Forum LLC)

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