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MA Regs Trumps the Feds

Posted on June 27, 2009 by Dissent

A privacy bill under consideration in Washington would significantly impact retail through provisions that would spell out how companies would have to protect customer data and what they must do if information is compromised, yet, as worrisome as that might be for some, any concern is essentially moot because a Massachusetts regulation with substantially the same provisions will go into effect Jan. 1.

And the rule is written in a way that essentially gives it jurisdiction in all 50 states….. once it goes into effect on Jan. 1, the Massachusetts regulation will put provisions akin to what the Federal bill proposes into effect nationwide. Retailers from Maine to California will be impacted for two reasons, Wugmeister said. First, because the federal bill won’t necessarily pre-empt state laws and second because the Bay State regulation was written to cover any company, down to the individual store, that does business with Massachusetts residents no matter where a subject transaction occurs. Now, a Massachusetts provision that applies to a Bostonian buying sunglasses in San Diego might not stand up to a legal challenge a retailer might be brave enough to make, or, given the sensitivity of the subject, foolhardy enough. However, the regulation also covers any company that is engaged in online transactions with Massachusetts residents in their home state. That element of the law, said Wugmeister, is more likely to stand up in court.

Read more on BNET Retail.

Related posts:

  • Obama’s federal data breach notification bill: boon to businesses, but not most consumers
Category: Breach TypesFederalLegislationOf NoteState/Local

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