What is cookie compliance? Meet legal requirements for cookies

How websites collect and use data has become a hot topic. What started as a harmless invention (cookies) for personalizing web user experience on websites quickly became a threat to data privacy. So much so that when cookies started becoming a public concern in the late 90s, several laws have since tried to address this issue. Fast forward to today, and now websites have to be extremely careful with how they collect data from their users and how they use that data, or else they risk facing stringent data privacy regulations.

With numerous data privacy laws monitoring how companies use their customers' data, it's now more important than ever to understand cookie compliance. As more people become aware of the importance of data privacy, websites must take extra measures to protect their users' data.

Let's start with addressing the basics.

What is cookie compliance?

Cookie compliance refers to adhering to data privacy laws and regulations, like GDPR and CCPA, regarding the use of cookies on websites. This involves informing users about cookie usage, obtaining their explicit consent, and providing options to manage cookie preferences to protect user privacy.

What are the legal requirements for cookies?

Legal requirements for cookies typically include informing users about cookie usage, detailing their purposes, obtaining explicit user consent before setting cookies, providing options to accept or decline cookies, and allowing users to change their cookie preferences at any time. Compliance with laws like GDPR and CCPA is essential. More on this below.

Why is cookie compliance important?

Cookie compliance is important because it ensures your website adheres to data privacy laws like GDPR and CCPA, protecting user privacy and building trust. Non-compliance can result in legal penalties and damage to your reputation. It also enhances user experience by being transparent about data collection.

In other words, website cookie compliance is when a website informs its visitors and users that it uses cookies. It also involves disclosing the information they collect and its purpose. However, cookie compliance doesn't stop at letting users know that your website uses cookies. Websites must obtain explicit consent to use their users' data. This is what's referred to as cookie banner compliance. Cookie banner compliance involves using cookie banners to achieve cookie consent compliance.

A cookie banner is an alert or a pop-up message that appears when a user visits a site for the first time. It explains the website's cookie policy and asks for consent to store data files (cookies) on the user's device to track their online activity and collect their data.

Now that we've covered the basics of cookie compliance, let's focus on the implications GPPR and CPRA cookie compliance regulations have on businesses today.

GDPR cookie compliance

One of the most important data privacy laws regarding cookie compliance is the General Data Protection Regulation (GDPR). Established in 2016, it regulates how companies handle the personal data of EU and UK citizens. The broader GDPR compliance framework emphasizes transparency, user control over their data, and accountability from organizations. Cookie compliance is a significant part of this framework. That's why GDPR is sometimes called the 'cookie law.'

The GDPR-compliant cookie policy goes beyond having a cookie banner on your website. The policy states that websites should detail the types of cookies they use, their purpose, and how long they remain active. They should also explain how users can change their cookie settings or withdraw their consent.

Simply put, to achieve a GDPR-compliant cookie banner, implied consent or pre-ticked boxes are no longer acceptable — explicit and informed consent is required. That said, EU cookie compliance banner requirements include the following:

• Clear information: Websites must provide clear, comprehensive information about the data each cookie tracks and its purpose in a clear and jargon-free way. The details should include what personal data is being collected, who is collecting it, and how it will be used.
• User consent: Websites must obtain consent before placing cookies on the user's device and collecting data. The only exception is for cookies that are strictly necessary for the operation of the site.
• Choice: Users should be able to decide whether to accept or reject different types of cookies. This means that they should not be forced to accept all cookies at once but should be able to decide on each type of cookie separately.
• Withdrawal: It should be as easy to withdraw consent as it was to give it. Websites must provide a simple and intuitive way for users to change their minds and remove their consent. For instance, websites can provide a link on the cookie banner to cookie settings.
• Design: Websites must ensure that the design of the cookie banner is user-friendly and adaptable to different screen sizes, such as laptops, mobile phones, and tablets.
• Documentation: For compliance purposes, websites must keep a record of when and how users gave consent. This documentation is important in the event of a data audit for GDPR cookie compliance or data breaches.
• Regular updates: Websites should regularly review and update their cookie policies to comply with GDPR cookie requirements. This includes removing unnecessary cookies and ensuring all third-party cookies comply with GDPR.

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CPRA cookie compliance

The California Privacy Rights Act (CPRA), also known as CCPA 2.0 or Proposition 24, is a law passed by California voters in November 2020. The main purpose of the CPRA was to amend and improve the California Consumer Privacy Act (CCPA), signed into law in June 2018. While both laws outline the privacy rights of Californians and data protection obligations for businesses, the CPRA expands and adds several regulations.

Generally, CPRA and CCPA cookie compliance mean that websites must be transparent about their use of cookies and obtain informed consent from users before collecting their personal information. But there are several differences between CCPA and CPRA cookie compliance:

• Expanded definition of sensitive personal information: CPRA cookie requirements introduce a broader definition of sensitive personal information, which includes race, ethnicity, information about sexual orientation, social security numbers, driver's license numbers, passport numbers, precise geolocation, genetic data, and biometric or health information. Cookies that collect this type of data are subject to stricter regulations.
• Opt-out of targeted advertising: Under the CPRA cookie banner requirements, consumers can opt out of websites using their personal information for targeted advertising purposes. This means websites must provide a clear and easy way for users to refuse cookies used for personalized ads.
• Data minimization and purpose limitation: The CPRA cookie requirements emphasize that businesses should collect only the data necessary for the purpose stated at the time of collection and not retain it longer than needed.
• Do not sell' vs. 'do not share': While CCPA cookie consent introduced the 'Do Not Sell My Personal Information' option, CPRA cookie consent extended this to 'Do Not Share.' This includes sharing data collected by cookies with third parties for cross-context behavioral advertising.
• Businesses affected: While CCPA cookie requirements only apply to businesses that bought, sold, or received the personal information of 50,000 or more California residents, the CPRA expands to businesses that share the personal information of over 100,000 California consumers or households.

Although these cookie compliance regulations do not explicitly require a CPRA or CCPA cookie banner, websites must disclose that they use cookies. They can do this through a privacy notice or policy easily accessible on the website.

Cookies and data privacy

The relationship between cookies and data privacy is complex. 

• On one hand, cookies enhance user experience by remembering login details and site preferences. They can collect information ranging from harmless preferences like language settings to sensitive data such as browsing history or location. This information lets websites provide personalized content, improving business engagement and conversion rates.
• On the other hand, while cookies contribute to a seamless internet experience, they also raise significant data privacy concerns if websites do not implement proper safeguards. For example, third-party cookies can track browsing history across multiple sites, creating a detailed profile of a user's online behavior.

Read more: What are third party cookies?

Ensuring cookie compliance

To achieve cookie compliance, make sure your brand or business is up-to-date in two essential areas: 

1. Update your data privacy policy. A data privacy policy, also known as a privacy notice or statement, is a document a company provides that explains how it collects, uses, stores, shares, and protects its customers', users', and employees' personal data. But for a data privacy policy to be effective, it must be transparent, easily accessible, and clearly state the types of cookies used, the data they collect, and how that data is processed and shared. Moreover, a strong policy gives users control over their data, including options to opt out of certain data collection practices or delete their data entirely.

1. Implement jurisdictionally-aware cookie consent notices. Whether CCPA, GDPR, or another data privacy regulation, each law has slightly different expectations for consent banners, notices, and opt-ins/opt-outs. To comply with these laws while optimizing your data collection practices, deploy privacy notices that are jurisdictionally-aware”–serving the right consent experience, to the right person, at the right time. Data privacy software (like Ketch consent and preference management) empowers you with policy templates and automation to implement this quickly and seamlessly across your websites. 

In conclusion, while cookies can enhance online experiences by providing personalized content and remembering preferences, websites must balance their use against the privacy rights of individuals. This allows them to benefit from the data gathered through cookies while doing so in a manner that respects and protects user privacy. Moreover, cookie compliance isn't just a one-time thing that companies can check off their list. It's an ongoing commitment that requires regular updates and audits to ensure alignment with evolving data privacy regulations and laws.

Go further: Give Ketch Free a try and start collecting consent in 5 minutes or less.