The Secure Times

An online forum of the ABA Section of Antitrust Law's Privacy and Information Security Committee

Article 29 Working Party Publishes Letter Criticizing the Proposed Online Behavioral Advertising Self-Regulatory Framework.

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Earlier this week, the Article 29 Working Party published a letter it sent to the Interactive Advertising Bureau Europe (IAB Europe) and the European Advertising Standards Alliance (EASA) regarding their proposed self-regulatory framework for online behavioral advertising (OBA) to satisfy the EU’s ePrivacy Directive.   The letter referred to a meeting between the Working Party and the OBA industry scheduled for sometime in September and was sent in advance of the meeting to inform the OBA industry of the Working Party’s main concerns with the proposed framework.

The Article 29 Working Party expressed several concerns with the current OBA industry proposals:

·         The absence of action by a consumer cannot be presumed to indicate his consent. Thus, the proposed opt-out scheme, which would allow consumers to be tracked before they exercise an objection, does not comply with the requirement set forth in Article 2(h) of Directive 95/46/EC that consent be “freely given, specific and informed.” 

·         The concern raised by the OAB industry that consumers’ online experiences will be negatively affected by having to continually agree to ad network cookies in order to view content has been overstated. The Working Party indicated that once consent has been given to an ad network, then the ad network will not have to seek consent again. The Working Party also suggested that the OAB industry could create a centralized method for consumers to provide consent to multiple ad networks.

·         The proposed browser methods for objecting to cookies are insufficient because they all currently default to accepting cookies. In order for a browser to provide valid consent, it must reject third-party cookies by default and require consumers to “engage in an affirmative action to accept cookies from specific websites for a specific purpose.”

·         The proposed icon on online advertisements is insufficient because: (i) the icons currently do not mean anything to average internet users; and (ii) the icons do not make the required information regarding tracking and profiling directly available (noting that once users click on the icon, they will still need to click at least two times to obtain the additional information and be able to opt out). 

The Working Party’s letter also attached a letter from David Vladeck, the Director of the FTC Bureau of Consumer Protection, responding to the Working Party’s request for information regarding the FTC’s position on transparency and consumer choice in connection with OBA.  Mr. Vladeck noted the guidance the FTC provided regarding OBA, including the 2009 FTC Staff Report, Self-Regulatory Principles for Online Behavioral Advertising, and the 2010 Preliminary Staff Report, Protecting Consumer Privacy in an Era of Rapid Change. Notably, the letter recognized the recent efforts of the OBA industry by stating “[s]ince the issuance of these reports, industry has taken a number of steps to improve transparency and consumer choice in the context of behavioral advertising.” Mr. Vladeck also summarized the FTC’s recent guidance regarding what it considers to be essential components of a successful Do Not Track mechanism: any mechanism should be easy to use, effective, universal and persistent.

Author: Eric Whisler

Associate at Vorys, Sater, Seymour and Pease LLP.

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