Legal Updates: What’s New in Digital and Cyber Liability Laws

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Farica Chang

By Principal Farica Chang

As technology progresses, so does the complexity of legal requirements concerning digital and cyber liability. Recent changes in these areas highlight the increasing importance of business owners staying informed and proactive in compliance efforts. This blog explains the latest developments in digital liability laws, particularly focusing on the American Rights Privacy Act, various state privacy laws, and the new EU-US data privacy framework, as well as updates in cybersecurity laws including NIST 2.0. Read on to learn more about these changes and how they could impact your business in 2024 and beyond.

Cyber Liability Laws: 3 Changes to Be Aware of

1. The American Rights Privacy Act
What It Is

The proposed American Rights Privacy Act is set to introduce stringent standards for data minimization. Under this act, businesses would be restricted to collecting and utilizing data strictly for necessary and explicitly defined purposes. This legislative push aims to curb excessive and often intrusive data practices that have become commonplace in digital business operations.

Why It’s Being Championed

The primary advocacy for this act stems from a growing demand for consumer privacy and control over personal information. Consumers are increasingly aware of how their data is handled and are calling for greater transparency and rights. This includes the ability to opt out of targeted advertising and restrict data transfers, empowering individuals to have a say in how their personal details are utilized commercially.

What It Means for Your Business

Should the American Rights Privacy Act pass, non-compliance could result in severe penalties from various enforcement bodies like the Federal Trade Commission and state attorneys general, not to mention direct lawsuits from consumers.

However, there are exceptions for smaller enterprises. If your business generates less than $40 million annually, handles data for fewer than 200,000 individuals, and doesn’t earn revenue from transferring covered data, you might be exempt. Nonetheless, compliance with other data protection regulations remains crucial to avoid significant legal and financial repercussions. As your business grows, it’s worth keeping this Act in mind when planning your cybersecurity strategy.

2. State-Specific Privacy Laws
What They Are

Echoing the California Consumer Privacy Act (CCPA), several states have adopted their own privacy statutes in recent years. These laws are tailored to the specific needs and concerns of local populations, leading to a patchwork of regulations that businesses must navigate carefully.

Why They’re Being Championed

Largely, individual states have been pressed to introduce comprehensive data privacy legislation because the federal government hasn’t. In a  digital world where consumers are expected to hand over data for everyday transactions, concerns about security are only growing. According to the Pew Research Center, 79% of US adults report being concerned about how companies use their data, so it is unlikely that privacy legislation, whether state or federal, will disappear completely.

How They Could Affect Your Business

Though Missouri currently has no state-specific personal data laws (aside from legislation about breach notifications and personal health information), the spread of locale-specific privacy laws means that businesses operating across state lines must be vigilant and adaptable to a variety of legal frameworks.

Since these standards can vary considerably from place to place, a thorough understanding of regional legal landscapes will soon be an invaluable tool for businesses. Cybersecurity experts based near you or who do business in your area could, therefore, prove to be an investment that pays dividends.

3. EU-US Data Privacy Framework for Cross-Border Data Transfer
What It Is

The EU-US Data Privacy Framework is a newly established protocol designed to enhance and facilitate the process of transferring personal data from the European Union to the United States. It provides a more secure legal basis for such data transfers, while ensuring that the standards for data protection required by EU citizens are upheld.

Why It’s Being Championed

The championing of this framework is driven by the necessity to bridge regulatory differences between the EU and the US concerning data protection. With the invalidation of the previous Privacy Shield framework by the European Court of Justice due to concerns over inadequate privacy protections, there was a significant void in legal certainty for transatlantic data flows.

The new framework is being promoted to restore trust and stability in these data exchanges, which are crucial for multinational businesses that rely on seamless transfers for operations and service delivery. It aims to ensure a high level of data protection and security that aligns with stricter European standards, helping foster greater cooperation and economic relations between the two regions.

What It Means for Businesses

For businesses engaged in transatlantic operations, this framework is critical. It requires adherence to robust protections equivalent to those afforded within the EU, affecting how American companies handle and protect European data. Compliance will not only facilitate smoother international operations, but also protect US businesses from potential legal challenges and fines.

Updates in Cybersecurity Guidance

NIST 2.0
What It Is

The National Institute of Standards and Technology (NIST) has updated its cybersecurity framework to NIST 2.0. This revision broadens the scope to accommodate a wider array of organizations, making it more accessible and applicable across different industries and business sizes.

Why It’s Being Championed

As you might have gathered, there’s no all-inclusive data protection legislation in place in the US right now. But businesses and consumers know the importance of solid data security in light of never-ending global cyber threats. For safety-focused organizations, NIST 2.0 offers a scalable and flexible framework through which to evaluate and improve their cybersecurity measures systematically.

What It Means for Your Business

Adopting the NIST 2.0 framework is voluntary, but highly recommended for any business seeking to enhance its cybersecurity posture. It’s especially valuable for small to medium-sized enterprises (SMEs) that may lack extensive security resources but remain equally at risk to cyber threats as larger companies.

The framework offers a structured approach to fortifying your protections, with a tiered system to guide businesses in assessing their risk management practices. Although not mandatory, utilizing NIST 2.0 can significantly aid in identifying vulnerabilities and strengthening defenses, which is becoming increasingly necessary as cyber threats evolve.

Updates in liability and cybersecurity laws reflect the ongoing commitment of legislative bodies to adapt to the ever-changing world of cyber threats. At their core, these laws aim to protect both businesses and consumers from the rising tide of cyber threats, ensuring a secure digital environment.

Staying ahead of legal requirements not only ensures compliance, but also serves as a protective measure against the potential damages from data breaches and cyberattacks. For businesses hoping to traverse this (often complex) hostile landscape, seeking out appropriate, reliable cybersecurity measures and staying informed about evolving laws are imperative.

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All too often, IT support is frustrating and burdensome. Why not find a true partner to take the weight off your shoulders? For nearly 30 years, Anderson Technologies has leveraged its strengths for the benefit of its clients, pulling together the right team for every project. We’re a dynamic team of IT professionals with over 200 years of combined experience and all the certifications you need to inspire confidence in our work. As a trusted advisor, we don’t just focus on today. We strive to take your technology lightyears ahead of your competition and scale with your business’s success. 

Want to discuss how changes to regulatory requirements could impact your business? Contact us today to get started.