Consent & Cookies under the Japanese Amended APPI

On 1 April 2022, the Japanese Amended Act on the Protection of Personal Information (APPI) came into force bringing significant changes to its breach internal procedures, cross-border data transfer, and cookie consent requirements among other changes. This article examines cookie consent requirements under the Amended APPI.

The Amended APPI strengthens the protection of data subjects’ rights relating to the transfer of their personal data to third parties. As a general rule, the Act requires organizations to obtain the data subject’s consent before transferring any personal data to third parties. However, it also allows organizations to rely on an opt-out consent mechanism where consent can be implied if adequate notice is given to data subjects and they are provided the option to object or opt-out. It is not explicitly clear in the law whether an organization should obtain opt-in consent or rely on an opt-out mechanism for the use of cookies, especially third-party cookies.

Opt-in consent refers to the explicit consent requirement where data subjects are given equally prominent options of accepting and rejecting the processing of their data. Opt-out consent on the other hand refers to the situation where the user’s consent is assumed by default and organizations allow data subjects to opt-out or object to the processing of their data.

Opt-in consent for the use of third-party cookies

The Amended APPI has introduced a new category of personal data, personally referable information (PRI). The PRI is different from Personal Information in that it does not directly identify individuals; rather the identification of individuals is possible only with the aid of additional data elements. And once PRI is linked with additional data elements, the PRI can become PI. Accordingly, third-party cookies can be classified as PRI as when combined with identifiers and other information received by the servers, they are able to create profiles of website users and identify them. So is the case with IP address, location data, information exchanged on DMPs (data management platforms) containing identifier information, and similar tracking technologies, all of which can be considered as PRI. The Amended APPI law requires opt-in consent for the use of PRI and therefore, an opt-in cookie consent banner is advised to companies making use of third-party advertising cookies (cookies related to targeted advertisements and marketing) and social plug-in tracking cookies.

Opt-out consent for the third-party transfer of personal data

Under the Amended version of the law, organizations can rely on an opt-out mechanism for the transfer of personal information (PI) to third parties provided they provide adequate notice to data subjects as well as the regulatory authority PPC and allow data subjects to object or opt-out. PI refers to information relating to a living individual that can identify specific individuals. However, organizations cannot rely on an opt-out consent mechanism for the use of third-party cookies and similar tracking technologies since those are classified as PRI and not PI and the opt-out exception only pertains to the transfer of PI. Moreover, the opt-out consent mechanism is also not possible for the processing of any special care-required personal information (SPI), sensitive personal data such as an individual’s race, creed, social status, medical history, and criminal record. In any case, organizations are not allowed to use deception or any fraudulent means to obtain the data subject’s consent.

What organizations must do?

In light of the above, it is clear that the Japanese privacy law has attempted to strengthen its consent requirements. Similar to the GDPR, it has supported the notion of an opt-in consent for online identifiers. On the other hand, the Amended law has reaffirmed the transparency principle by requiring organizations to notify data subjects before the transfer of their personal information to third parties. Keeping in consideration the consent requirements of the Amended APPI, organizations aiming to comply with Japanese law are advised to be cautious of their consent collecting practices. At the very least, organizations must:

• Obtain opt-in consent for the use of third-party advertising cookies, social plug-in tracking cookies, IP addresses, and similar online identifiers and tracking technologies,
• Provide adequate notice (privacy notice/cookie banner) to data subjects before transferring their information to third parties regardless of an opt-in or opt-out mechanism and let them acknowledge the notification before the transfer,
• Keep a record of consent statements received and maintain comprehensive audit trails

How Securiti can help?

Securiti’s Universal Consent Management Solution enables marketers to adequately advertise and market their products in a compliant manner by capturing consent and automating revocation. Securiti’s Cookie Consent Banner Solution enables companies to build cookie consent banners in accordance with the applicable legal requirements when collecting personal data for non-essential purposes on digital properties.

Ask for a DEMO today to understand how Securiti can help you comply with the applicable legal requirements of global data privacy laws and regulations with ease.