Illinois and Internet Privacy Bills: What Businesses Need to Know

 In Operations

Companies are pushing for more customer data.  This information serves for making decisions on product development, crafting marketing campaigns, and deciding the overall direction of operations moving forward.

For customers, though, the popularity of data collection has brought concerns. A report from the TRUSTe/National Cyber Security Alliance (NCSA) reveals that 68 percent of customers are concerned about how their personal information is being used. Meanwhile only 57 percent say they’re concerned about losing their principal income. Perhaps acknowledging these concerns, legislators in Illinois are taking action to keep customers safe.

Right to Know

Among the bills working their way through the Illinois legislature is the Right to Know Act, which passed in the Illinois Senate Judiciary Committee recently. If approved across the board, the bill will require apps and websites to notify Illinois consumers of the information they’re collecting. If they sell or give the information to third parties, businesses will also have to disclose the names of those third parties to customers.

The act only provides a broad definition of the type of information it covers. Mostly it relates to personal data like names, addresses, birth dates, race, and gender. The law would not only apply to Illinois businesses. It also applies to any company that collects data on Illinois customers. These companies could be responsible for disclosing data collection efforts to the state’s residents.

What It Means

If you do business with Illinois customers, it’s important to follow the path of this bill. The good news is, if it’s passed, businesses will not have to proactively disclose data collection activities. A customer would have to request the information following a transaction with a business. Once requested, businesses would have up to 30 days to provide it. This means that companies should be ready to disclose their data collection practices quickly. If businesses aren’t already tracking the information they collect and what they do with that data, they will likely need to begin creating that paper trail once the bill is in place.

If the Illinois bill goes through, it could serve as a model for other states. These are states considering setting local privacy restrictions in light of the possible federal regulation rollback. For businesses that serve multiple states, this could create additional work. Companies will be required to set separate policies for data collection and tracking based on where customers live. The current federal rule requires internet providers to ask permission before collecting data on the online habits of their customers.

Opponents are concerned that the bill could stifle the state’s booming data analytics industry, especially in Chicago. However, many businesses will likely only need to ensure they’re tracking their information collection and usage efforts to prepare for a possible disclosure request. For businesses collecting and using information meeting customer approval, the bill may have few negative repercussions.

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