Wednesday, August 25, 2021

Personal Data Will Be Considered As A Means Of Payment As Of January 1, 2022

The Decree-Law 7/2021, which is based on two European directives, will replace the general consumer protection law, and will affect everyone who has an account on a social network, as well as on a streaming service such as Spotify or Netflix.

From its entry into force, the new regulation will consider personal data as a means of payment for this type of services, which turns the relationship between the consumer and the company into a contract where the former have their rights. Until now, the legislation was ambiguous and did not contemplate that the user could have a voice, being a free service.

Thus, the consumer who opens an account on a social network or streaming service for free will have the same rights as users who decide to pay during registration. In the event that the processing of personal data is not accepted, companies may terminate the contract and stop providing the service.

Another key feature of the new digital regulation is the consumer's right to stop paying for the service in the event that the company does not comply with the agreed service, as well as the extension of the term - up to three years - for users to show their dissatisfaction with products that include digital elements, such as smartphones, tablets or smartwatches.

Although the new regulation on personal data is a step forward in the field of digital rights, some experts believe that the text could include significant improvements. For example, in the case of the company only collecting metadata from its users or the parameters for establishing compensation.

Personal data marketplaces, an ethical challenge for the years to come

The new regulation will come into force in the midst of the debate on transparency and best practices in personal data marketplaces, known as data marketplaces in the industry. The World Economic Forum considers that, for the time being, "many barriers, such as commercial governance, public policies and regulation, are hindering the exchange and use of data to solve critical challenges and bring innovation to society".

In this context, the organization encourages the creation of "a governance structure" for these personal data marketplaces, with a "well-designed market, where the providers of these 'marketplaces' will be a key component, acting with the dual function of trust and economic incentive," they say.

In any case, the buying and selling of personal data has become a multi-billion dollar business in recent years, and everything seems to indicate that its ceiling is still far off. In this context, administrations will have to fight against the abuses that some companies may commit in the absence of regulation, while entrepreneurs must seek new formulas that include the consumer in the equation.

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