California Governor Jerry Brown signed on Thursday a new data privacy legislation that’s designed to give consumers more control over how companies collect their personal data. The data privacy bill was opposed by major Silicon Valley companies including Google. Under the new legislation, big tech companies that already hold the data of over 50,000 people will be required to let consumers know what data they have collected on them. In addition to this, the law gives consumers the opportunity to request for deletion and to opt out from having their information sold to third-party companies.
The new law is expected to take effect by 2020. Any kind of violation will attract a fine of up to $7,500. The law only applies to California residents. Speaking after the signing, California Senator, Democrat Bob Hertzberg, said that the law marked a very important step forward for the people of California. The legislation was unanimously passed by the two houses of legislature in California before it was signed hours later by the governor.
There was also an attempt to push the measure to a public vote in November. However, this didn’t happen. In fact, analysts say that it was a good thing that the law was passed by the two houses instead of a public vote. Legislations formed and passed by lawmakers are often easier to amend compared to those that go through a public vote.
The new measure is expected to affect almost all tech companies based in Silicon Valley. However, the large companies that continue to play a central role in online communication and e-commerce will be the main target. Data breaches that have affected companies such as Facebook and Uber have attracted public pressure on the need to protect consumer data privacy. The new measure passed in California is seen as a timely response to this pressure.
Nonetheless, executives at Alphabet Inc., the company that owns Google, have warned that the new law will have a number of unintended consequences. The company didn’t precisely reveal what these consequences would be but its opposition to the legislation has been very clear right from the start. Google’s senior vice president Sridhar Ramaswamy told reporters that there will be a set of ramifications after the passing of this law that will be very difficult to understand. Ramaswamy added that it’s important to thoroughly balance user privacy with legitimate business needs.
The bill was also opposed by the Internet Group, a consortium of tech companies that include Facebook and Amazon. California’s Chamber of Commerce and the National Retail Federation and the Association of National Advertisers had also voiced their concern over the bill. According to these companies, such state-specific laws will stifle innovation in Silicon Valley. One challenge that has been mentioned is on how the law will be implemented. Even though the legislation will affect California residents only, most of the tech companies in this state have always operated beyond borders. This might pose a few challenges in enforcement once the law takes effect after two years.