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Financial Services Law Insights and Observations

Utah legislature passes privacy bill

Privacy/Cyber Risk & Data Security State Issues State Legislation Consumer Protection Utah

Privacy, Cyber Risk & Data Security

Recently, the Utah legislature passed SB 227, which would enact the Utah Consumer Privacy Act and establish a framework for controlling and processing consumers’ personal data in the state. (See also senate and house approved amendments here.) Highlights of the bill include:

  • Applicability. The bill will apply to a controller that conducts business in the state or produces products or services for consumer residents that also “has annual revenue of $25,000,000 or more” and “controls or processes personal data of 100,000 or more consumers” or “derives over 50% of the entity’s gross revenue from the sale of personal data and controls or processes personal data of 25,000 or more consumers.” Certain entities are exempt from the bill’s requirements, including governmental entities and third parties under contract with a governmental entity that acts on behalf of that entity; tribes; institutions of higher education; nonprofits; certain types of health information subject to federal health privacy laws; consumer reporting agencies, furnishers, and consumer report users of information involving personal data bearing on a consumer’s credit; financial institutions and affiliates subject to federal privacy disclosure requirements; personal data regulated by certain federal regulations; and air carriers. Additionally, a controller will be considered to be in compliance with the bill’s parental consent obligations provided it complies with verifiable parental consent mechanisms under the Children’s Online Privacy Protection Act.
  • Consumer rights. Under the bill, consumers will be able to, among other things (i) confirm whether their personal data is being processed and access their data; (ii) delete their data; (iii) obtain a copy of their previously provided data; and (iv) opt out of the processing of their data for targeted advertising and the sale of their data.
  • Controllers’ and processors’ responsibilities. Under the bill, data controllers will be responsible for responding to consumers’ requests within 45 days (an additional 45-day extension may be requested under certain circumstances). Responses to consumers’ requests must be provided free of charge, “unless the request is the consumer’s second or subsequent request during the same 12-month period.” Data processors must adhere to a controller’s instructions and enter into a contract with clearly specified instructions for processing personal data. The bill also requires controllers to provide privacy notices to consumers disclosing certain information regarding data collection and sharing practices (including sharing with third parties), and if the controller sells a consumer’s personal data to third parties or engages in targeted advertising, the controller must disclose how consumers may exercise their rights under the bill. Controllers also will be prohibited from processing sensitive personal data without first presenting a consumer with the opportunity to opt out. The bill further specifies requirements for processing deidentified data or pseudonymous data.
  • Private right of action and state attorney general enforcement. The bill explicitly prohibits a private right of action. Instead, it gives the Division of Consumer Protection investigative power and grants the state attorney general excusive authority to enforce the law and seek penalties of up to $7,500 per violation. The attorney general may also recover reasonable investigation and litigation expenses.
  • Right to cure. Upon discovering a potential violation of the bill, the attorney general must give the controller or processor written notice. The controller or processor then has 30 days to cure the alleged violation before the attorney general can file suit.

If enacted in its current form, the bill would take effect December 31, 2023.