Proposed Calif. law could add to data reporting burden

Companies doing business in California may soon be required to keep detailed records of all the customer data they sell to third parties for direct-marketing purposes.

If a bill that was considered by the state Assembly this week passes, California residents will have the right to ask companies they deal with to provide details of any personal information sold to direct marketers.

California's proposed SB 27, also known as the "Shine the Light" bill, was initially introduced by Sen. Liz Figueroa in December. It was defeated in the Assembly last month and then reintroduced this week with some amendments.

If passed, the bill could prove "quite burdensome" to implement, said Walter Janowski, an analyst at Gartner

Customer data that's sold for direct-marketing purposes is commonly available as lists, he said. "The ability to query an individual customer's record, determine if it is on a particular list, and track the sales and sharing activity of that list is typically not a functionality that is at the fingertips of most marketers today," Janowski said.

In principle, the bill is a positive step for consumers, said Michael Overly, a partner at Foley & Lardner, a Los Angeles law firm.

"Imposing an obligation on companies to track this sort of data is a great idea, there's no doubt about it," Overly said. "But it is going to be incredibly costly policing the law."

Louis Mastria, director of public and international affairs at the Direct Marketing Association in New York, last week said his organisation is strongly opposed to the bill. The DMA already has strict guidelines relating to the manner in which personal information is used by member companies, so the proposed legislation is unnecessary, he claimed.

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