Your consent 'almost always' needed when firms use your data to profile you

Watchdog, er... reassures Euro punters

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Organisations "almost always" require individuals' "free, specific, informed and unambiguous 'opt-in' consent" in order to make use of personal data they have previously collected in Big Data projects that involve analysing or predicting the "personal preferences, behaviour and attitudes of individual customers", an EU privacy watchdog has said.

The Article 29 Working Party said that the "further use" of individuals' personal data for Big Data projects centred on individuals would not be justified without that consent in most cases. Under EU data protection laws, personal data must be "processed fairly and lawfully" and be collected for "specified, explicit and legitimate purposes and not further processed in a way incompatible with those purposes".

"Such consent should be required, for example, for tracking and profiling for purposes of direct marketing, behavioural advertisement, data-brokering, location-based advertising or tracking-based digital market research," the Working Party said in a new opinion. (70-page/790KB PDF)

The Working Party, which is a committee made up of representatives from each EU national data protection authority, defined 'big data' as the extensive analysis of "gigantic digital datasets held by corporations, governments and other large organisations" using computer algorithms with a view to better understand and exploit data for the purpose of making " better and more informed decisions".

It said that for consent to be considered 'informed', organisations would need to provide individuals access to the 'profiles' they have built about them, as well as the underlying "logic of the decision-making (algorithm) that led to the development of the profile".

"This is a crucial safeguard and all the more important in the world of big data," the watchdog said. "More often than not, it is not the information collected in itself that is sensitive, but rather, the inferences that are drawn from it and the way in which those inferences are drawn, that could give cause for concern. Further, the source of the data that led to the creation of the profile should also be disclosed."

Businesses engaging in big data projects centred on individuals should also provide individuals with the right to "correct or update" the profiling information, the Working Party said. This would combat the "risk of inaccurate inferences" being made and provide firms with "more accurate information" on which to base their marketing decisions, it said.

Companies should also embrace the principle of 'data portability' to allow individuals to share the data firms hold about them with others if they wish, the Working Party said.

"In many situations, safeguards such as allowing data subjects/customers to have direct access to their data in a portable, user-friendly and machine-readable format may help empower them, and redress the economic imbalance between large corporations on one hand and data subjects/consumers on the other," the Working Party said. "It would also let individuals 'share the wealth' created by Big Data and incentivise developers to offer additional features and applications to their users."

The watchdog outlined its view on Big Data and privacy in a new paper that details its view on what businesses must do to ensure personal data they source is collected for "specified, explicit and legitimate" purposes and not "further processed in a way incompatible" with those purposes.

The Working Party outlined a four-factor criterion to help businesses evaluate whether their further processing activities are compatible with the purposes for which personal data was first collected.

It said that the "relationship between the purposes for which the data have been collected and the purposes of further processing; the context in which the data have been collected and the reasonable expectations of the data subjects as to their further use; the nature of the data and the impact of the further processing on the data subjects; [and] the safeguards applied by the controller to ensure fair processing and to prevent any undue impact on the data subjects" should be evaluated as part of the "compatibility assessment".

In its opinion, the Working Party said that where businesses engage in big data projects that involve trying to "detect trends and correlations" from personal information, they may not require individuals' consent to process their data for that purpose providing they put in place certain safeguards.

It said that if firms intending to use personal data for that purpose can ensure that the information is not used to "support measures or decisions ... taken with regard to the individual data subjects concerned" – such as through anonymisation measures – they may not require individuals' consent to engage in the activity.

However, those firms would still require to ensure that the information is kept confidential and secure and "take all necessary technical and organisational measures" to ensure that this 'functional separation' of the data is maintained, the Working Party said.

"Although there is not, strictly speaking, new material in the opinion, the fact that several pages are devoted to the European Convention on Human Rights and the EU's Charter of Fundamental Rights indicates a hardening of attitude," Information law specialist Marc Dautlich of Pinsent Masons, the law firm behind Out-Law.com, said. "The Working Party has obviously seen fit to rehearse the arguments in full technicolour detail, complete with 22 examples at the end of the opinion to provide specific context, and indirectly demonstrate that effort has been made to anchor the guidance in real world business models."

"Expect to spend time looking at your purposes and consents much more closely before you embark on your next big data project," he added. "As one practitioner put it to me 'we are all brand advisers now, this is no longer about ‘just data protection stuff’ and it hasn’t been for some time – this is about your organisation’s reputation'."

Copyright © 2013, Out-Law.com

Out-Law.com is part of international law firm Pinsent Masons.

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