Everything You Need to Know About Colorado Data Privacy Law

Nearly every country has enacted some kind of data privacy legislation to regulate how information is collected, transferred, and used. Data privacy laws also regulate how data subjects are informed and the level of control a data subject has over the information once it’s transferred. Failure to comply with the applicable data privacy laws may lead to lawsuits, fines, and even prohibition of your website’s use in certain jurisdictions. Unfortunately, for many small- and medium-sized businesses, navigating these laws and regulations may be daunting. This guide highlights the Colorado data privacy laws you should be aware of.

Colorado State Data Privacy Laws

There are hundreds of sectoral data privacy and data security laws enacted by various U.S. states. State Attorney Generals are tasked with overseeing data privacy laws that govern the collection, storage, disposal, use, and safeguarding of personal data collected from their residents, particularly regarding data breach notifications and the protection of Social Security numbers. Some legislation applies only to governmental entities, some to private entities, and others apply to both. Other than the sectoral privacy laws, the U.S. is witnessing a stronger push towards data privacy legislation at the state level. State lawmakers have been pushed by consumers, consumer advocates, and companies to establish their own rules. Colorado has joined Virginia and California in passing a comprehensive data privacy law that requires companies to make wholesale adjustments to how they handle users’ sensitive information online. The Colorado Privacy Act was signed into law on July 7, 2021, by Governor Jared Polis, giving consumers the right to ask organizations not to sell their personal information. It also offers consumers access to any data that companies have about them. Additionally, consumers can ask organizations to delete their data, and enterprises should ask consumers for consent to store certain sensitive information about them, such as Social Security Numbers, telephone numbers, email addresses, driver’s license numbers, and more. While certain states have passed narrow laws focused on specific practices for data collection and sale, Colorado is the third state to pass a commercial privacy law, after California and Virginia.

Who Is Affected By the Data Privacy Law?

Besides giving consumers rights over their private data, the act also forces organizations to respect consumer opt-out requests. The law typically applies to companies that gather personal data from 100,000 to 25 000 Colorado residents and generate revenue from the sales. Taking effect in July 2023, the legislation has been hailed by experts as a vital step forward for data privacy in the U.S. However, many people still have concerns about a myriad of loopholes in the bill that some companies are already taking advantage of. For example, the bill did not have a private right to action, and there are numerous exemptions, especially for non-profits. Although the CPA includes punitive fines per violation, the lack of overreaching federal privacy law still leaves loopholes for collecting first-party data, which raises doubts about the safety of user data. So, more work needs to be done to ensure a transparent exchange of sensitive data between consumers and businesses. Fortunately, the Colorado Data Privacy law aligns a little better with GDPR. For example, the requirement to abide by the universal opt-out will protect consumers from manipulations. The Attorney General has until July 1, 2023, to provide the technical specifications for the opt-out. Afterward, everybody will get a year to abide by it. This is a massive development since companies must abide by what is often programmed into a web browser as a default setting.

Additional Developments in the Law

Another significant development in the Colorado data privacy law is the heightened demand for “privacy impact assessments.” This has forced companies to assess the kind of data they collect and store. This provision is a feature of the GDPR and is part of Virginia law. However, it is largely invalidated due to numerous exemptions. Under Colorado’s law, there are almost no exemptions, meaning enterprises will have to conduct impact assessments for every project that collects users’ personal data. However, new assessments will need to be done if there are further changes to the policies, staff, and vendors. Besides, there is a one-year look-back period, meaning that the data collected by the end of the year will be within the scope of the legislation. Another major provision is the right to appeal to any unsolicited use of private data, a unique feature among the global data privacy laws. Only the Virginia and Colorado laws allow users to appeal decisions to refuse consumers’ requests to have their data deleted. In the next couple of months, it’s predicted that New York, Florida, and Texas might be the next states to enact data privacy laws. Unfortunately, the prolonged length of most states’ legislative sessions is what makes it hard to pass such kinds of laws. For example, some states that seemed likely to pass data privacy laws, such as Washington, eventually ran out of time due to the controversies surrounding the laws locally.

Security Breach Notification

Whether you’re an individual, government entity, or commercial entity that collects P.I., you need to familiarize yourself with Colorado’s security breach notification laws. You should always report security breaches in accordance with the requirements of the Colorado data privacy law. Examples of a security breach include:
  • An employee clicking on a link or opening an email attachment with malware
  • An employee disclosing their password or other sensitive information to unauthorized persons
  • Your entity becoming a victim of a ransomware attack
  • Unencrypted P.I. channeled through a payment system
  • Misplacing or losing a briefcase containing client files
  • Misplacing a mobile device or data storage gadget containing personal information

Wrapping Up

Overall, your company website should have a privacy policy that clarifies to users what information you collect, how you use it, how you can share it, and how you secure the data. Besides complying with the Colorado Data Privacy Law, your website must be fully compliant with E.U. and U.S. data protection laws. At initial.I.T., we have 20+ years of experience providing I.T. services to organizations throughout Denver. We primarily serve Engineering, Architecture, and construction industries. When you partner with our team of skilled I.T. services professionals, you’ll have an expert focused on maximizing your I.T. infrastructure by providing premier technical and customized I.T. support solutions. Contact us today to learn more about the Colorado Data privacy law and how it impacts your business.