23 December 2020
The California Consumer Privacy Act (CCPA) took effect on January 1st, 2020. This new privacy law will affect businesses all over the world. The law makes a lot of demands on businesses. In particular, it requires businesses to fully disclose how they treat consumers' personal information.
On your road towards CCPA compliance, one important job is to update your Privacy Policy to reflect the CCPA's strict new transparency requirements. We're going to walk you through how to create a CCPA Privacy Policy and examine how the CCPA's Privacy Policy requirements differ from those of other privacy laws.
The CCPA takes the United States closer to the sort of strict privacy regime that has existed for many years in the EU. It's clearly influenced by the EU's General Data Protection Regulation (GDPR). But even GDPR-compliant businesses will have a lot of work to do to comply with the CCPA.
There are two main reasons why you need a Privacy Policy:
✓ They're legally required: Privacy Policies are legally required by global privacy laws if you collect or use personal information.
✓ Consumers expect to see them: Place your Privacy Policy link in your website footer, and anywhere else where you request personal information.
Excerpt from TermsFeed Testimonials:
"I needed an updated Privacy Policy for my website with GDPR coming up. I didn't want to try and write one myself, so TermsFeed was really helpful. I figured it was worth the cost for me, even though I'm a small fry and don't have a big business. Thanks for making it easy."
Stephanie P.
Generated a Privacy Policy
Generate a Privacy Policy, 2021 up-to-date, for your business (web, mobile and others) with the Privacy Policy Generator from TermsFeed.
The CCPA applies to "businesses." However, the CCPA defines "business" very narrowly.
A business is any for-profit entity doing business in California, that either:
A business also "determines the purposes and means of the processing of personal information." If you're familiar with the GDPR, you'll know that this is the definition of a "data controller."
Most companies fit this description. If your business collects personal information directly from its users, it probably fulfills this criteria.
Most businesses that aren't data controllers are "service providers."
Service providers process personal information on behalf of other businesses. For example, MailChimp emails a company's customers on that company's behalf. Service providers are known as "data processors" in other privacy laws.
Service providers aren't required to create a Privacy Policy only for the CCPA. However, note that under most other privacy laws you will be required to create one anyway.
The CCPA isn't (only) aimed at businesses based in California. It's aimed at any business that processes the personal information of consumers in California. So, much like another major California privacy law, the California Online Privacy Protection Act (CalOPPA), the CCPA applies to businesses all over the world.
Your business could be based anywhere from Fresno to France - as long as your services are accessible in California, you could be covered by the CCPA and have to adhere to its requirements.
Failing to maintain a CCPA-compliant Privacy Policy could result in a fine of up to $2,500 per violation.
This might not sound too bad until you consider that a "violation" occurs each time a person accesses your non-compliant website or app.
California's existing Privacy Policy law, CalOPPA, is enforced under the same rules as the CCPA. Delta Airlines narrowly escaped potential fine of over $37 million under CalOPPA for failing to add a Privacy Policy to its mobile app. This was due to the large number of customers who had downloaded the Delta Airlines app. It's easy to see how these fines, even if small on their own, can really add up.
Here is a list of frequently asked questions that you may find useful.
If you are a "business" as defined by the CCPA and do business with people located in California, you must have a CCPA-compliant Privacy Policy.
A "business" under the CCPA will meet one of the following requirements:
It doesn't matter where your business is located. If you have customers in California and meet one of the 3 requirements above, you must have a CCPA-compliant Privacy Policy.
The CCPA requires that your Privacy Policy be updated once every 12 months, be conspicuously linked to your website and that the Policy provides the following information:
To update your existing Privacy Policy for CCPA compliance, make sure you have or add in the following information:
The CCPA requires you to update your Privacy Policy once every 12 months.
The CCPA requires that you provide a "conspicuous" link to your Privacy Policy. Put this link in your website footer along with other important legal agreements like your Terms and Conditions agreement.
You should also add a link to your CCPA Privacy Policy at areas of your website where you request to collect personal information.
For example:
For mobile apps, the same concept applies. Add a link to your CCPA Privacy Policy in a menu within your app, such as an "About" or "Legal" menu. Also add the link to other areas of your app where you request personal information, such as when a user creates an account or provides a telephone number for app notifications.
Make your CCPA Privacy Policy enforceable by having your users click an unticked checkbox next to a statement that says something similar to "I have read and agree to the terms of the Privacy Policy."
You can also have users click a button that says something like "I Agree" next to a statement like the above if you don't want to use a checkbox.
We're going to take a detailed look at each of these requirements and some examples of businesses that are already complying.
There are a couple of important things to note before we do this.
You must update your Privacy Policy every 12 months.
You must post a "conspicuous" link to your Privacy Policy on your website's front page.
Most here's how The Guardian does this:
Here's a run-down of the information you need to provide in your Privacy Policy for CCPA-compliance.
The CCPA contains a new set of consumer rights. Your Privacy Policy must inform your consumers of their rights.
Consumers have the right to request access to personal information. They can make this request for free, twice per year.
On receiving an access request, you must provide the necessary information in a portable and easily accessible format, normally within 45 days of the request.
When providing information under the right of access, you must include:
If the business sells personal information, the consumer also has a right to request access to the following information:
The consumer has a right to request the deletion of personal information that the business holds on the consumer.
However, this right does not apply where the business needs to retain the personal information in order to do any of the following:
The consumer has the right not to be discriminated against for having exercised their rights under the CCPA. In particular, the business may not:
You need to let consumers know about all of these rights.
Here's how CBD Medic informs consumers about their right of access:
And here's how Runza informs consumers about their right to non-discrimination:
You can have a clause for each right that helps your customers understand what their rights are and how you're going to facilitate them.
It's not enough to simply tell consumers about their rights. You need to set up a system to help consumers exercise their rights. This must often include a toll-free number and web-page.
Your Privacy Policy must tell consumers how to submit a request to exercise their CCPA rights.
Here's how Techbuyer approaches this:
Note how the clause begins with a phone number and email address that customers can use to exercise the rights. Then, further details and important information is included such as what the customer must do, and any limitations for the requests.
The CCPA has Notice requirements that you'll need to become familiar with as well, which we address in detail in our article: CCPA Notices. These notices include 4 consumer-specific notices.
The CCPA requires any business that sells consumers' personal information to provide a web page where consumers can opt out of having their personal information sold. This is known as a "Do Not Sell My Personal Information" page. The business must link to this page both on the front page of its website and in its Privacy Policy.
The CCPA Opt-out by TermsFeed solution can be used to help your website visitors opt-out of any personalized ads that you serve on your website through third-party JavaScript scripts, such as Google Ads.
You can build your CCPA Opt-Out code by following the steps below:
Here's how FloraFlex displays the link to its Do Not Sell My Personal Information page in its Privacy Policy:
While FloraFlex is obviously keen to demonstrate compliance with the CCPA, it's worth noting that only businesses that do sell personal information are required to comply with this part of the CCPA.
You must provide a list of the categories of personal information you've collected over the past 12 months.
To comply with this requirement, you need to know what constitutes "personal information" under the CCPA. Here's the definition as it appears in the CCPA:
"information that identifies, relates to, describes, is capable of being associated with, or could reasonably be linked, directly or indirectly, with a particular consumer or household."
The CCPA lists the following categories of personal information:
Here's how Vertafore Solutions approaches this:
You don't have to use a chart format, but it's something to consider since it helps keep things organized and makes information easier for your users to sort through.
In addition to telling your users what categories of personal information you collect, you need to disclose your sources of personal information.
You may collect personal information from a variety of sources, depending on the context in which your business operates. You only need to list the categories of sources, i.e. the types of companies or other sources.
Here's an example from Brown-Forman:
Some of the sources listed include publicly-available database data, social network information and from marketing partners.
The CCPA requires that you tell consumers why you collect personal information - your purposes for collecting it. What are you actually doing with their personal information?
Here's how Abacus does this in its Privacy Policy:
This type of clause is very standard across the board for Privacy Policies, so it's highly likely that yours already has this type of clause included.
Your Privacy Policy must list all the categories of personal data your business has sold in the past 12 months. If it hasn't sold any personal information over this period then it must disclose this.
Here's how Malibu Boot Camp approaches this:
Note that the company has not sold any personal information in the past 12 months, so it lists "No" for each of the CCPA's categories of personal information. You can also make a simple blanket declaration that you have not sold any personal information in the past 12 months.
Your Privacy Policy must list all the categories of personal information your business has "disclosed for business purposes" over the past 12 months. If you haven't disclosed any personal information for business purposes over this period then you still must disclose this.
The CCPA gives seven categories of activities that count as "business purposes." If you share consumers' personal information with a third party so that they can perform these sorts of activities for you, you must disclose this in your Privacy Policy.
Note that these examples are not exhaustive.
Here's how marketing company Lumen5 discloses how it shares its users' personal information with service providers:
A CCPA-compliant Privacy Policy needs to go further than this by listing the categories of personal information disclosed for each business purpose.
Here's how the CCPA's Privacy Policy requirements match up against two other major privacy laws - the GDPR (EU) and CalOPPA (California).
CCPA | GDPR | CalOPPA |
Information about California consumers' CCPA consumer rights. | Information about your EU users' GDPR data subject rights. | N/A |
Instructions on how California consumers can request access to and deletion of their personal information. | Instructions on how your EU users can exercise their rights over their personal information. | Instructions on how California consumers can request access to and deletion of their personal information (if you allow this). |
A link to your "Do Not Sell My Personal Information" page. | Instructions on how your EU users can opt out of direct marketing or withdraw consent to the processing of their personal information. | Instructions on how consumers can opt out of third-party cookies (if you use them). |
A list of the categories of personal information you've collected over the past 12 months. | A list of the categories of personal information you process. | A list of the categories of personal information you collect. |
Your sources of each category of personal information you collect. | The ways in which you process personal information (this would include information about where you collect it from). | N/A |
Your purposes for collecting each category of personal information. | Your purposes for processing each category of personal information. | N/A |
A list of all the categories of personal information you've sold over the past 12 months. | N/A | N/A |
A list of all the categories of personal information you've disclosed for business purposes over the past 12 months. | N/A | N/A |
N/A | Your company's name and contact details. | N/A |
N/A | Names and contact details of key personnel (Data Protection Officer, EU Representative). | N/A |
N/A | A list of the categories of organizations with whom you share personal information. | A list of the categories of organizations with whom you share personal information. |
N/A | Your lawful basis for processing each category of personal information. | N/A |
N/A | The periods for which you store each category of personal information. | N/A |
N/A | Information about any international transfers of personal information outside the EU. | N/A |
N/A | N/A | The date on which the Privacy Policy takes effect. |
N/A | N/A | Information about how you will inform consumers of any changes to the Privacy Policy. |
N/A | N/A | Information about how your website responds to Do Not Track signals from visitors' web browsers. |
N/A | N/A | Information about your use of third-party cookies or other tracking technologies (if you use them). |
For more information about how these laws compare, see:
Your CCPA Privacy Policy must contain:
You must update your Privacy Policy every 12 months according to the CCPA. Make sure to reflect this by updating your Privacy Policy's 'effective date' even if you don't make any other changes to the Policy.
This article is not a substitute for professional legal advice. This article does not create an attorney-client relationship, nor is it a solicitation to offer legal advice.