The nation’s best-known service for resolving disputes between consumers and businesses is joining the movement to police privacy on-line, a move that could help head off European sanctions against U.S. companies.
BBBOnline, the Internet arm of the 86-year-old Better Business Bureau, is launching a privacy seal designed to help consumers easily identify Web sites and on-line merchants that safeguard their credit, medical and other personal records.
On-line privacy protection is emerging as a major consumer issue following December’s record volume of on-line gift buying. As computer users flock to the Web, more Internet publishers and merchants are asking them to leave personal information behind.
Consequently, U.S. Internet firms are being urged to toughen their privacy safeguards. Federal officials have repeatedly warned the industry to get its house in order or risk federal regulation. U.S. negotiators also face a June 21 deadline for agreement with the European Union on standards for protecting personal data.
U.S. and EU negotiators met again last week in an ongoing effort to develop standards that will satisfy much higher European expectations regarding the collection and use of personal data. Failure to resolve the issue will expose U.S. companies to a new European law prohibiting the transmission of such data to any country that fails to devise an acceptable standard–sanctions that could be devastating to U.S. Internet firms.
U.S. Undersecretary for International Trade David Aaron, who was briefed by the non-profit Better Business Bureau as it developed its program, said the safeguards could help convince European Union officials to put their faith in the industry-led approach favored by the United States.
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The program will include on-site inspections of member companies and a dispute-resolution process that will respond to consumer privacy complaints about participating–and even non-participating–Web sites, bureau officials said.
“The dispute settlement and the monitoring is a big part of what they like about it,” Aaron, the chief U.S. negotiator, said of the program. But resistance to self-regulation remains strong in some countries, he added. “They tend to view industry self-governance as the fox guarding the chicken coop.”
But European officials are likely to look with favor upon another aspect of the program–the requirement that consumers be able to gain access to all the information a member Web site collects on them. Firms won’t be able to set unreasonable fees or conditions for providing this information, bureau general counsel Steve Cole said. “For example, they can’t charge you $15. Or they can’t say, `You can only come once every five years,’ ” he said.
In many ways, the bureau’s program resembles an existing one from Truste, a Palo Alto, Calif., non-profit agency whose on-line privacy seals are displayed by about 500 major Web sites.
The bureau’s program, which spokeswoman Sydney Rubin said about 350 companies have sought to join so far, will permit members to display a logo designed to let consumers know that the site they’re visiting follows acceptable practices. It will cost members an annual fee of between $150 and $3,000, depending on the company’s sales volume.