Internet privacy: Cookies as a weapon

Network World - In November 2009 the European Parliament approved a directive on Internet privacy that, among other things, required user opt-in before websites could install cookies on the user's computer.

In theory, any U.S. company running a website that may be used by any citizen of any European Union country would have to follow the rules or risk being brought up on charges by an EU country.

BACKGROUND: EU orders member states to implement cookie law, or else

Over the past two years many European Union member states have passed legislation implementing the directive, but the specific requirement for cookie opt-in has remained confusing. The Justice Department of the European Commission has been trying to figure out just what might constitute opt-in in the context of the directive. The primary group working on the issue has been the Article 29 Working Party.

That group's members recently met with European advertisers who would like to use more of an opt-out approach by maintaining that users who agree to visit a website are, by their action, opting in to the website's practices. The Working Party seems to disagree and wants instead a clear opt-in process.

This could be more than a little disruptive if implemented: Imagine a pop-up window asking if it is OK to store a cookie for each of the sites that wanted to put a cookie on your machine when you went to one website. For example, nine different companies store cookies on your computer when you connect to The New York Times homepage, the same number as do for the Network World homepage.

The U.S. has mostly met the requirements of the EU privacy rules by implementing the Safe Harbor framework. U.S. companies can self-certify that they meet the EU rules when dealing with EU customers (but do not need to provide similar protections for U.S. customers). Some 3,000 companies have self-certified, but many have not kept up-to-date on the certification. The frameworks will need to be updated when the cookie rules have been finalized.

In any case, the Safe Harbor is a good way to cover your butt if you are doing business in Europe or with European customers.

One thing that the Safe Harbor makes clear is that the U.S. does not have any meaningful privacy protection laws when it comes to the data that Internet companies collect about all of us. The Federal Trade Commission has been looking into the issue and has asked for responses to a bunch of questions in this field.

They are collecting comments here.

Congress, as one might expect, is looking at the issue as one of personal freedom for advertisers rather than anything to do with the privacy of Internet users.