FTC Introduces Major Updates to Children’s Online Privacy Protection Rule
The Federal Trade Commission (FTC) has officially announced significant updates to the Children’s Online Privacy Protection Act (COPPA) rule, a move that aims to bolster safeguards surrounding the privacy of children online. This update, which has been a long time in the making, will take effect on June 23, 2025. The decision was finalized this week, marking the first major overhaul of federal children’s privacy laws since COPPA was originally enacted in 2000. This renewed focus on children’s online privacy comes amid escalating concerns regarding the handling of personal data by digital platforms, particularly for the purposes of advertising.
For years, advocates for privacy rights have been vocal about the need for stricter regulations to protect children in a rapidly evolving digital landscape. The updated rule has now been published in the Federal Register, thereby assuring its implementation as planned, despite prior uncertainties surrounding its future under the oversight of the new FTC Chairman, Andrew Ferguson. Historically, Ferguson has expressed skepticism about the necessity for these updates, raising questions about whether changes would be enacted. However, the publication of the rule has alleviated those concerns among advocates and policymakers.
A New Era for Children’s Online Privacy
The revisions to COPPA are the result of more than six years of collaborative efforts among privacy advocates and policymakers who recognized the growing vulnerabilities associated with children’s online activities and the burgeoning collection of personal information by digital companies. Under the updated rule, websites and applications targeting children under the age of 13 will now be required to comply with rigorous guidelines concerning the collection and management of personal information. These enhancements expand the existing requirements, imposing additional responsibilities on businesses to ensure the safeguarding of children’s data.
Notably, the updated legislation emphasizes that personal data must be managed securely, and it restricts the sharing of such information. A key feature of the new rule is the introduction of a mandatory annual risk assessment for operators of children-focused websites and applications. Moreover, companies must adopt clear privacy practices, specifically outlining the types of data collected, the identities of any third parties with whom data is shared, and the purposes for which the data is collected.
Enhanced Consent Requirements
One of the most consequential updates encompasses the stipulations regarding how personal data can be shared with external parties. Previously, data-sharing practices were largely dictated by the companies themselves. The updated rule mandates that websites and applications must secure separate, verifiable parental consent before disseminating any data to third parties, including advertisers and data brokers. This crucial addition aims to empower parents, granting them greater control over the usage of their children’s personal data.
The requirement also extends to the necessity for companies to disclose to parents the specific identities of third parties with whom data is shared, as well as the intended uses of that data. This push for transparency is fundamental, ensuring that parents are well-informed about the digital environments their children engage with.
Addressing Online Advertising Concerns
Significantly, the updated COPPA regulations respond to growing concerns surrounding online advertising and its influence on children. Numerous applications and websites collect extensive data from young users, subsequently monetized through advertising or targeted campaigns. The new regulations will impose tighter controls over these practices, specifically aimed at curbing the activities of digital advertising firms that depend on extensive data collection for user targeting.
By regulating the flow of data to third parties, the FTC’s revisions intend to mitigate the overreach of digital advertising companies and promote a more responsible approach toward children’s data management. As companies are compelled to reevaluate the types of data they gather and the methods employed for its storage and sharing, the digital marketing landscape, particularly regarding child-focused content, stands to undergo significant transformation.
Legislative History and Ongoing Challenges
While the FTC’s new rule represents a considerable advance, it is vital to recognize it as part of a broader context of regulatory efforts aimed at enhancing children’s online privacy. In 2023, Congress proposed COPPA 2.0, which aimed to impose even stricter measures, mandating active parental consent before any data collection could take place on platforms designed for children. Although this bill garnered significant support, it was ultimately sidelined, merging with other legislation like the Kids Online Safety Act (KOSA). This merger resulted in the formation of the Kids Online Safety and Privacy Act (KOSPA), which passed the Senate yet failed to clear the House of Representatives, casting a shadow of uncertainty over the future of children’s online privacy reforms.
A Comprehensive Approach to Protecting Children’s Privacy
With its recent decision, the FTC has established a clearer path for both businesses and consumers. The finalized rule is considerably more comprehensive than its predecessor, taking into account a wide array of concerns that were not adequately addressed when COPPA was first established. The new regulations outline stricter protocols regarding parental consent, data retention, and third-party data sharing, providing a stronger framework for safeguarding children’s online privacy.
The rule is set to come into effect in June 2025, with an adjustment period allowing companies until April 2026 to align with the new standards. While this timeline provides businesses with necessary time for adaptation, the FTC has made it clear that noncompliance with the updated regulations could lead to severe penalties, emphasizing the importance of adhering to these new guidelines. This strategic approach represents a milestone in the ongoing endeavor to protect children in the ever-evolving digital landscape.