[co-author: Stephanie Kozol]
In addition to a night of revelry, the 2023 new year will trigger the many new privacy mandates in the Virginia Consumer Data Protection Act (VCDPA) for businesses operating in Virginia — only the second state with active consumer privacy legislation behind California, with other states’ privacy laws, such as Colorado, Connecticut and Utah, taking effect later this year. Virginia Attorney General Miyares is no doubt eager to flex his new authority under the VCDPA, meaning companies that process, collect, or sell Virginians’ personal information should carefully read the VCDPA to ensure their compliance with the new law.
Troutman Pepper has covered the VCDPA since the bill became law in March 2021. Our Virginia Consumer Data Protection Act Series provides a detailed overview of the VCDPA, while also comparing it to California’s Consumer Privacy Act (CCPA) as amended by the California Privacy Rights Act (CPRA). Modeled in part on the CCPA/CPRA and the EU’s General Data Protection Regulation (GDPR), the VCDPA will give Virginians several new consumer privacy rights over their “personal information,” including the right to access, the right of rectification, the right to delete, the right to opt out, the right of portability, and the right against automatic decision making. Notably, unlike California’s privacy law, the VCDPA does not provide for rulemaking by the AG, thus, the act itself determines compliance, not government office or agency-passed rules.
As the VCDPA takes effect, it is important for entities doing business with Virginians to recognize that the VCDPA broadly defines “personal information” as “any information that is linked or reasonably linked to an identified or identifiable natural person” and adds a more protected subcategory of personal data called “sensitive data,” which includes all data revealing demographic information, religious beliefs, health diagnoses, sexual orientation, immigration status, genetic/biometric information, any data collected from a child, or precise geolocation. Entities must “conduct and document a data protection assessment” if they process any sensitive data, sell personal data, or process personal data for targeted advertising or profiling purposes, among many other requirements.
During the 2022 legislative session, the Virginia legislature passed multiple amendments to the VCDPA. The first set of amendments established a new exception to the VCDPA’s right to delete, applicable when a source other than the consumer collects personal data. Under this new exception, data is considered deleted if (1) a minimal record of the deletion request is retained for the exclusive purpose of ensuring the consumer’s data is/remains erased; or (2) the consumer has opted out of all nonexempt data processing activities (e.g., targeted advertising and sales). The second set of amendments eliminates the VCDPA’s “Consumer Privacy Fund” and diverts all funds collected under this law to the state treasury’s Consumer Advocacy, Litigation, and Enforcement Revolving Trust Fund. These amendments also redefine “nonprofit organizations” to include tax exempt political organizations.
Although the VCDPA is only the second comprehensive consumer privacy law in the United States and Virginia’s first comprehensive privacy law, it should not be read in isolation from the commonwealth’s existing framework of privacy-related laws. As Troutman Pepper reported in November 2022, Virginia has already enacted a number of privacy statutes, such as the Personal Information Privacy Act (PIPA), Insurance Data Security Act (IDSA), and Data Breach Notification Law (DBNL), which require certain entities doing business with Virginians to carefully consider cybersecurity and consumer privacy obligations when dealing with consumer data. As a result, entities should remain mindful of any applicable requirements under Virginia’s pre-existing network of related laws, such as the PIPA, IDSA, and DBNL, which the VCDPA will add to — not replace.
Why This Matters
In an environment consisting of a patchwork of state-level privacy legislation that affects how businesses use and interact with consumer data, companies need to consider working with outside counsel to develop a consumer privacy compliance program that — in addition to complying with relevant obligations under the jurisdictions with consumer privacy laws, such as Virginia and California — allows for some flexibility as statehouses across the country pass new consumer privacy laws and regulations in the coming years.
