Privacy

Congress and Cookies by Bob Woods --------------------------------------------------------------------------------

(2/12/01) A bill working its way through Congress could have a significant impact on how Internet marketers conduct their daily business.

Rep. Gene Green (D-Texas) has introduced H.R. 347, "The Consumer Online Privacy and Disclosure Act.

Provisions of the legislation include requiring an "opt-in" by consumers before a "persistent cookie" is placed on their consumers by a third party. The opt-in will serve as notice that someone is attempting to profile a consumer's time spent online.

Green said his legislation is not intended to prohibit e-commerce companies from developing their own customer lists for internal uses. But e-commerce firms firms should not allow third-party concerns to track Web surfers without their knowledge and consent.

"Consumers do not want their personal information tracked," Green said. "If consumers can stroll through the local mall and not have everything they look at and recorded, the same should apply to the Internet."

"This legislation prevents anonymous third parties from attaching `persistent cookies' to consumers as they move through a Web site, and holds online companies to their privacy policy."

The bill also calls on the Federal Trade Commission (FTC) to require Web site operators to state their privacy policies in "non-legalistic terms;" which, in non-legalistic terms, means good ol' English. The legal notice would be required to be placed in a conspicuous place, and would contain the identity of the operator, the owner's physical and e-mail address, what personal information is collected by the operator, how the owner uses the information, and what information is sold to or shared with other companies.

Also, the legislation would require any insolvent e-commerce company that attempts to sell its database to obtain consent from each consumer in the database before the information is sold. This requirement comes after Toysmart attempted to auction its customer list, after the toy e-tailer last year went out of business.

Companies that run afoul of the bill's provisions would be in violation of the Federal Trade Commission Act, and could be fined in the range of $1,000 to $50,000 or more for each violation, plus court costs. A state or federal court could also issue protective orders and conduct legal proceedings to protect the secrecy and security of personal information stored in offenders' databases.

The bill is currently before the House Committee on Energy and Commerce. There's no word as to when hearings will start on the legislation.

H.R. 347 is similar to S. 197, "The Spyware Control and Privacy Protection Act," a bill introduced this year in the Senate by Sen. John Edwards (D-N.C.), according to the Association for Interactive Media (AIM). The Consumer Online Privacy and Disclosure Act re-introduces legislation that was originally put forth last year in both the House and Senate.

http://www.newmedia.com/nm-ie.asp?articleID=2494