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Maryland Enacts Kids Codes (AADC)

04 Jul

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Update Applicable to:Effective date
All covered entitiesOctober 1, 2024


What happened?

On May 9, 2024, Maryland’s Governor signed the Maryland Age-Appropriate Design Code Act (the “Kids Code” or AADC), a privacy law directed specifically towards businesses that offer an online product reasonably likely to be accessed by children under the age 18.


What are the details?

By enacting the Kids Code, Maryland joins a minority of states with laws similar to the Kids Code, including California and Florida.


Key Bites:

  • The bill requires a “covered entity” that provides an online product reasonably likely to be accessed by children to complete a “data protection impact assessment” of the online product. It also establishes several prohibitions.
  • It establishes numerous rules, procedures, and prohibitions related to the assessments.
  • A covered entity that violates the bill’s requirements is subject to a civil penalty of up to $2,500 per affected child for each negligent violation and $7,500 per affected child for each intentional violation.
  • A data protection impact assessment is protected as confidential and must be exempt from public disclosure, including under the Maryland Public Information Act.
  • Violation of the bill is an unfair, abusive, or deceptive trade practice under the Maryland Consumer Protection Act (MCPA), and subject to MCPA’s civil and criminal penalty provisions.
  • The bill specifies entities and information to which its requirements do not apply
  • Consumer does not include employment context (employer-employee relationship):

(2) “CONSUMER” DOES NOT INCLUDE AN INDIVIDUAL ACTING IN A COMMERCIAL OR EMPLOYMENT CONTEXT OR AS AN EMPLOYER, AN OWNER, A DIRECTOR, AN OFFICER, OR A CONTRACTOR OF A COMPANY, PARTNERSHIP, SOLE PROPRIETORSHIP, NONPROFIT ORGANIZATION, OR GOVERNMENTAL UNIT WHOSE COMMUNICATIONS OR TRANSACTIONS WITH THE COVERED ENTITY OCCUR SOLELY WITHIN THE CONTEXT OF THAT INDIVIDUAL’S ROLE WITH THE COMPANY, PARTNERSHIP, SOLE PROPRIETORSHIP, NONPROFIT ORGANIZATION, OR GOVERNMENTAL UNIT.

For a good breakdown click here.

For some challenges to the AADC or Kids Code click here.


Business Considerations

  • Employers should determine if their business falls under the purview of the Act.
  • Employers should identify which of your products is covered under the Act. The Maryland AADC applies to online products that are “reasonably likely to be accessed by children.”
  • Employers should ensure that their business is fulfilling its duty of care as stipulated by the Act. The AADC imposes a “best interests of children” duty of care when designing, developing, and providing products reasonably likely to be accessed by children and should process children’s data in a manner that is consistent with this duty.
  • Employers should conduct a Data Protection Impact Assessment (DPIA) for each online service, product, or feature that is reasonably likely to be accessed by children, as required by the MD AADC. The DPIA should determine whether the product is designed with the best interests of children in mind.
  • Employers should ensure that all privacy settings provided to children default to a “high level of privacy,” unless your business can demonstrate a compelling reason for a different default setting.


Source References


Resources

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