The EU Legal Framework for Cookies and Tracking Technologies

Background

The GDPR applies to all personal data processing and requires a lawful basis, such as consent. The ePrivacy Directive complements the GDPR and provides specific rules for electronic communication data use. It requires prior informed consent from users unless strictly necessary for the requested service or certain limited exceptions.

Some websites use anonymized cookies and tracking tech to avoid legal frameworks. These tools remove identifiers that link data to specific individuals.

Are anonymized cookies and tracking technologies effective and legal in the EU?

How anonymous are these technologies, and what are the risks?

What are the best practices for complete data anonymization?

This article delves into the paradox that Data Controllers must manage in their daily business operations.

Introduction

The European Union (EU) has been at the forefront of regulating privacy and data protection in the rapidly evolving digital landscape. A significant part of these regulations addresses using cookies and other tracking technologies.?

While essential for the functionality and personalization of online services, these tools pose significant privacy risks. The EU's legal framework aims to balance the interests of users and service providers while mitigating risks through the General Data Protection Regulation (GDPR) and the ePrivacy Directive (also known as the "Cookie Law"). This article explores the EU's regulatory approach to cookies and tracking technologies, focusing on anonymization techniques and the threats posed by re-identification.

EU Legal Framework: GDPR and ePrivacy Directive

The GDPR, which came into effect in May 2018, has set a high standard for data protection worldwide. It requires organizations to implement stringent data protection measures, ensuring the privacy and protection of EU citizens' personal data. This regulation applies to all entities, regardless of location, that process the personal data of individuals within the EU.

The ePrivacy Directive, specifically addressing electronic communications, complements the GDPR. It mandates prior informed consent for storing or accessing information on a user's device, including cookies and similar technologies. The forthcoming ePrivacy Regulation, intended to replace the Directive, aims to harmonize the rules across the EU further and adapt to technological advancements.

Anonymization and its Importance

Anonymization involves processing personal data so individuals cannot be identified, considering all the means reasonably likely to be used. This technique is critical in the context of cookies and tracking technologies, as it allows for the collection and analysis of data without compromising individual privacy. Properly anonymized data falls outside the GDPR scope, offering organizations a pathway to leverage data while adhering to privacy regulations.

Techniques for Anonymizing Data

1. Data Masking: Replacing identifiable information with fictional but realistic data.
2. Pseudonymization: Substituting private identifiers with pseudonyms is a form of masking in which one can still retrieve the original data with additional information.
3. Aggregation: Combining data to handle individual data points that are not easily re-identified.
4. Differential Privacy: It involves introducing randomness into datasets to prevent the identification of individuals while allowing for the analysis of the data as a whole.

Re-identification Threats

First,?anonymization techniques may need to be sufficiently robust or adequate to prevent re-identification, especially in online tracking, where multiple sources and types of data can be combined, correlated, or inferred to reveal the identity or characteristics of individuals. For example, encryption or hashing may be reversible if the key or the algorithm is compromised or guessed, and aggregation or generalization may not eliminate unique or rare patterns or outliers. Moreover, anonymization techniques may not be future-proof, as new technologies, methods, or data sources that could enable re-identification may emerge.

Second,?Anonymizing data may not align with the legal definitions of personal data under GDPR and the ePrivacy Directive. Personal data includes any information about an identifiable natural person. The GDPR has a broad concept of personal data and identification, which may consist of anonymized data if there is a chance of re-identification.

Despite the effectiveness of anonymization techniques, the risk of re-identification remains a significant concern. Advanced algorithms and the availability of vast amounts of data can sometimes re-identify individuals from anonymized datasets. This risk is incredibly high with high-dimensional data, where multiple attributes can uniquely identify individuals.

Similarly,?the ePrivacy Directive covers all data processed in an electronic network, including traffic, location, and content data. Unless strictly necessary, the Directive requires consent to use stored or accessed user data, such as cookies and tracking technologies. The Directive applies to all information used for tracking purposes, including anonymized data.

Thirdly,?anonymization may not align with the expectations and purposes of data subjects and controllers, leading to loss of control and rights over data. It may not align with the interests or obligations of controllers, who might have ethical, contractual, or legal reasons to retain personal data for accountability, compliance, or quality purposes.

Anonymization is not a universal solution for privacy and data protection issues related to cookies and tracking technologies. Its effectiveness and feasibility depend on contextual factors. Anonymization is a form of personal data processing subject to GDPR. Data controllers must fulfill all relevant obligations, including obtaining a legal basis for processing, informing data subjects, and complying with data protection principles and rights.

Measures to Combat Re-Identification

1. Ensuring Data Minimization: Collect only the data necessary for a specific purpose.
2. Applying Robust Anonymization: Employ state-of-the-art techniques and regularly update them to counter advances in re-identification methods.
3. Limiting Data Access: Restrict access to anonymized datasets to minimize the risk of malicious attempts at re-identification.
4. Continuous Monitoring and Assessment: Regularly evaluate the risk of re-identification as new methods and data become available.

The way ahead

• Choice and consent.?Cookie and tracking technology use require informed user consent unless necessary for the requested service or specific exceptions.?User's?consent should be specific, free, informed, and unambiguous; users can withdraw or modify it.
• Data collection and processing.?Cookies and other tracking technologies should only be used when necessary for the intended purposes. The data collected and processed should be relevant, adequate, and reasonable. Furthermore, it is vital to keep the data for the shortest possible period and delete or anonymize it when it is no longer needed?(Minimization).
• Implement protection by design and by default.?Cookies and other tracking technologies should be implemented and designed to ensure the highest level of privacy and data protection so that users can comply with the obligations and principles of the GDPR and the ePrivacy Directive.
• Monitor and review the data collection and processing.?The use of cookies and other tracking technologies should be subject to regular and effective monitoring and review to ensure that the data collection and processing are consistent and compliant with the purposes and the consent of the users and that the data is accurate, secure, and up to date.

Conclusion

The EU's legal framework for cookies and tracking technologies is a robust system designed to protect individual privacy while allowing for the innovative use of data. Anonymization techniques play a crucial role in this balance, enabling the use of data in a way that respects privacy.

However, the threat of re-identification is an ongoing challenge that requires vigilance and continuous innovation in privacy-enhancing technologies. As the digital landscape evolves, so must the approaches to ensuring the anonymity and privacy of individuals, a task that will require cooperation among regulators, organizations, and technology providers.

1. The?Guide to Basic Anonymization?issued by the Personal Data Protection Commission of Singapore, subsequently?published?by the Spanish Data Protection Authority, should be referred to.