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FTC calls for online privacy legislation

‘Do not track’ system predicted by 2012 end

WASHINGTON – Congress should pass online privacy legislation and businesses should voluntarily change how they handle personal data to protect consumers in the fast-evolving digital world, the Federal Trade Commission said Monday.

The agency issued a lengthy final report that reiterated its long-standing call for online advertisers and makers of Web browsers to enact a “do not track” system that allows consumers to prevent the collection of data about their Internet surfing.

The report also called for new rules for data brokers, including legislation to give consumers access to information about them collected by those companies.

“We are confident that consumers will have an easy-to-use and effective Do Not Track option by the end of the year because companies are moving forward expeditiously to make it happen and because lawmakers will want to enact legislation if they don’t,” said Jon Leibowitz, the agency’s chairman.

The report follows preliminary staff recommendations released in late 2010 that called for companies to build consumer privacy protections into all their products, provide greater transparency about the collection and use of personal data, and provide simpler tools for people to control what information businesses collect from them.

In response to some of 450 public comments on those preliminary recommendations, the FTC’s final report refined its proposed guidance for companies and Congress.

Among the revisions is an exemption from privacy rules for companies that collect non-sensitive data from fewer than 5,000 consumers a year if that information is not shared with third parties.

The report came after Obama administration officials last month issued their own report pushing Congress to enact a privacy “bill of rights” that would give consumers more control over their personal information.

But with Congress still wrestling with privacy legislation, the administration also announced a voluntary effort by leading companies involved in online advertising, including Google Inc., Yahoo Inc. and Microsoft Corp.