Senate File 262 - Introduced SENATE FILE 262 BY COMMITTEE ON TECHNOLOGY (SUCCESSOR TO SSB 1071) A BILL FOR An Act relating to consumer data protection, providing civil 1 penalties, and including effective date provisions. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 1267SV (2) 90 es/rn

S.F. 262 Section 1. NEW SECTION . 715D.1 Definitions. 1 As used in this chapter, unless the context otherwise 2 requires: 3 1. “Affiliate” means a legal entity that controls, is 4 controlled by, or is under common control with another legal 5 entity or shares common branding with another legal entity. 6 For the purposes of this definition, “control” or “controlled” 7 means: 8 a. Ownership of, or the power to vote, more than fifty 9 percent of the outstanding shares of any class of voting 10 security of a company. 11 b. Control in any manner over the election of a majority of 12 the directors or of individuals exercising similar functions. 13 c. The power to exercise controlling influence over the 14 management of a company. 15 2. “Aggregate data” means information that relates to a 16 group or category of consumers, from which individual consumer 17 identities have been removed, that is not linked or reasonably 18 linkable to any consumer. 19 3. “Authenticate” means verifying through reasonable means 20 that a consumer, entitled to exercise their consumer rights in 21 section 715D.3, is the same consumer exercising such consumer 22 rights with respect to the personal data at issue. 23 4. “Biometric data” means data generated by automatic 24 measurements of an individual’s biological characteristics, 25 such as a fingerprint, voiceprint, eye retinas, irises, or 26 other unique biological patterns or characteristics that is 27 used to identify a specific individual. “Biometric data” 28 does not include a physical or digital photograph, a video or 29 audio recording or data generated therefrom, or information 30 collected, used, or stored for health care treatment, payment, 31 or operations under HIPAA. 32 5. “Child” means any natural person younger than thirteen 33 years of age. 34 6. “Consent” means a clear affirmative act signifying a 35 -1- LSB 1267SV (2) 90 es/rn 1/ 23

S.F. 262 consumer’s freely given, specific, informed, and unambiguous 1 agreement to process personal data relating to the consumer. 2 “Consent” may include a written statement, including a 3 statement written by electronic means, or any other unambiguous 4 affirmative action. 5 7. “Consumer” means a natural person who is a resident of 6 the state acting only in an individual or household context and 7 excluding a natural person acting in a commercial or employment 8 context. 9 8. “Controller” means a person that, alone or jointly with 10 others, determines the purpose and means of processing personal 11 data. 12 9. “Covered entity” means the same as “covered entity” 13 defined by HIPAA. 14 10. “De-identified data” means data that cannot reasonably 15 be linked to an identified or identifiable natural person. 16 11. “Fund” means the consumer education and litigation fund 17 established pursuant to section 714.16C. 18 12. “Health care provider” means any of the following: 19 a. A general hospital, ambulatory surgical or treatment 20 center, skilled nursing center, or assisted living center 21 licensed or certified by the state. 22 b. A psychiatric hospital licensed by the state. 23 c. A hospital operated by the state. 24 d. A hospital operated by the state board of regents. 25 e. A person licensed to practice medicine or osteopathy in 26 the state. 27 f. A person licensed to furnish health care policies or 28 plans in the state. 29 g. A person licensed to practice dentistry in the state. 30 h. “Health care provider” does not include a continuing care 31 retirement community or any nursing facility of a religious 32 body which depends upon prayer alone for healing. 33 13. “Health Insurance Portability and Accountability Act” 34 or “HIPAA” means the federal Health Insurance Portability and 35 -2- LSB 1267SV (2) 90 es/rn 2/ 23

S.F. 262 Accountability Act of 1996, Pub. L. No. 104-191, including 1 amendments thereto and regulations promulgated thereunder. 2 14. “Health record” means any written, printed, or 3 electronically recorded material maintained by a health care 4 provider in the course of providing health services to an 5 individual concerning the individual and the services provided, 6 including related health information provided in confidence to 7 a health care provider. 8 15. “Identified or identifiable natural person” means a 9 person who can be readily identified, directly or indirectly. 10 16. “Institution of higher education” means nonprofit 11 private institutions of higher education and proprietary 12 private institutions of higher education in the state, 13 community colleges, and each associate-degree-granting and 14 baccalaureate public institutions of higher education in the 15 state. 16 17. “Nonprofit organization” means any corporation organized 17 under chapter 504, any organization exempt from taxation 18 under sections 501(c)(3), 501(c)(6), or 501(c)(12) of the 19 Internal Revenue Code, any organization exempt from taxation 20 under section 501(c)(4) of the Internal Revenue Code that 21 is established to detect or prevent insurance-related crime 22 or fraud, and any subsidiaries and affiliates of entities 23 organized pursuant to chapter 499. 24 18. “Personal data” means any information that is linked or 25 reasonably linkable to an identified or identifiable natural 26 person. “Personal data” does not include de-identified or 27 aggregate data or publicly available information. 28 19. “Precise geolocation data” means information derived 29 from technology, including but not limited to global 30 positioning system level latitude and longitude coordinates or 31 other mechanisms, that identifies the specific location of a 32 natural person with precision and accuracy within a radius of 33 one thousand seven hundred fifty feet. “Precise geolocation 34 data” does not include the content of communications, or 35 -3- LSB 1267SV (2) 90 es/rn 3/ 23

S.F. 262 any data generated by or connected to utility metering 1 infrastructure systems or equipment for use by a utility. 2 20. “Process” or “processing” means any operation or set 3 of operations performed, whether by manual or automated means, 4 on personal data or on sets of personal data, such as the 5 collection, use, storage, disclosure, analysis, deletion, or 6 modification of personal data. 7 21. “Processor” means a person that processes personal data 8 on behalf of a controller. 9 22. “Protected health information” means the same as 10 protected health information established by HIPAA. 11 23. “Pseudonymous data” means personal data that cannot 12 be attributed to a specific natural person without the use 13 of additional information, provided that such additional 14 information is kept separately and is subject to appropriate 15 technical and organizational measures to ensure that 16 the personal data is not attributed to an identified or 17 identifiable natural person. 18 24. “Publicly available information” means information 19 that is lawfully made available through federal, state, or 20 local government records, or information that a business has 21 reasonable basis to believe is lawfully made available to 22 the general public through widely distributed media, by the 23 consumer, or by a person to whom the consumer has disclosed the 24 information, unless the consumer has restricted the information 25 to a specific audience. 26 25. “Sale of personal data” means the exchange of personal 27 data for monetary consideration by the controller to a third 28 party. “Sale of personal data” does not include: 29 a. The disclosure of personal data to a processor that 30 processes the personal data on behalf of the controller. 31 b. The disclosure of personal data to a third party for 32 purposes of providing a product or service requested by the 33 consumer or a parent of a child. 34 c. The disclosure or transfer of personal data to an 35 -4- LSB 1267SV (2) 90 es/rn 4/ 23

S.F. 262 affiliate of the controller. 1 d. The disclosure of information that the consumer 2 intentionally made available to the general public via a 3 channel of mass media and did not restrict to a specific 4 audience. 5 e. The disclosure or transfer of personal data when a 6 consumer uses or directs a controller to intentionally disclose 7 personal data or intentionally interact with one or more third 8 parties. 9 f. The disclosure or transfer of personal data to a third 10 party as an asset that is part of a proposed or actual merger, 11 acquisition, bankruptcy, or other transaction in which the 12 third party assumes control of all or part of the controller’s 13 assets. 14 26. “Sensitive data” means a category of personal data that 15 includes the following: 16 a. Racial or ethnic origin, religious beliefs, mental or 17 physical health diagnosis, sexual orientation, or citizenship 18 or immigration status, except to the extent such data is used 19 in order to avoid discrimination on the basis of a protected 20 class that would violate a federal or state anti-discrimination 21 law. 22 b. Genetic or biometric data that is processed for the 23 purpose of uniquely identifying a natural person. 24 c. The personal data collected from a known child. 25 d. Precise geolocation data. 26 27. “State agency” means the same as defined in 129 IAC 27 10.2(8B). 28 28. “Targeted advertising” means displaying advertisements 29 to a consumer where the advertisement is selected based on 30 personal data obtained from that consumer’s activities over 31 time and across nonaffiliated websites or online applications 32 to predict such consumer’s preferences or interests. “Targeted 33 advertising” does not include the following: 34 a. Advertisements based on activities within a controller’s 35 -5- LSB 1267SV (2) 90 es/rn 5/ 23

S.F. 262 own or affiliated websites or online applications. 1 b. Advertisements based on the context of a consumer’s 2 current search query, visit to a website, or online 3 application. 4 c. Advertisements directed to a consumer in response to the 5 consumer’s request for information or feedback. 6 d. Processing personal data solely for measuring or 7 reporting advertising performance, reach, or frequency. 8 29. “Third party” means a natural or legal person, public 9 authority, agency, or body other than the consumer, controller, 10 processor, or an affiliate of the processor or the controller. 11 30. “Trade secret” means information, including but not 12 limited to a formula, pattern, compilation, program, device, 13 method, technique, or process, that consists of the following: 14 a. Information that derives independent economic value, 15 actual or potential, from not being generally known to, and not 16 being readily ascertainable by proper means by, other persons 17 who can obtain economic value from its disclosure or use. 18 b. Information that is the subject of efforts that are 19 reasonable under the circumstances to maintain its secrecy. 20 Sec. 2. NEW SECTION . 715D.2 Scope and exemptions. 21 1. This chapter applies to a person conducting business in 22 the state or producing products or services that are targeted 23 to consumers who are residents of the state and that during a 24 calendar year does either of the following: 25 a. Controls or processes personal data of at least one 26 hundred thousand consumers. 27 b. Controls or processes personal data of at least 28 twenty-five thousand consumers and derives over fifty percent 29 of gross revenue from the sale of personal data. 30 2. This chapter shall not apply to the state or any 31 political subdivision of the state; financial institutions, 32 affiliates of financial institutions, or data subject to Tit. V 33 of the federal Gramm-Leach-Bliley Act of 1999, l5 U.S.C. §6801 34 et seq.; persons who are subject to and comply with regulations 35 -6- LSB 1267SV (2) 90 es/rn 6/ 23

S.F. 262 promulgated pursuant to Tit. II, subtit. F, of the federal 1 Health Insurance Portability and Accountability Act of 1996, 2 Pub. L. No. 104-191, and Tit. XIII, subtit. D, of the federal 3 Health Information Technology for Economic and Clinical Health 4 Act of 2009, 42 U.S.C. §17921 - 17954; nonprofit organizations; 5 or institutions of higher education. 6 3. The following information and data is exempt from this 7 chapter: 8 a. Protected health information under HIPAA. 9 b. Health records. 10 c. Patient identifying information for purposes of 42 U.S.C. 11 §290dd-2. 12 d. Identifiable private information for purposes of the 13 federal policy for the protection of human subjects under 45 14 C.F.R. pt. 46. 15 e. Identifiable private information that is otherwise 16 information collected as part of human subjects research 17 pursuant to the good clinical practice guidelines issued by 18 the international council for harmonization of technical 19 requirements for pharmaceuticals for human use. 20 f. The protection of human subjects under 21 C.F.R. pts. 6, 21 50, and 56. 22 g. Personal data used or shared in research conducted in 23 accordance with the requirements set forth in this chapter, or 24 other research conducted in accordance with applicable law. 25 h. Information and documents created for purposes of the 26 federal Health Care Quality Improvement Act of 1986, 42 U.S.C. 27 §11101 et seq. 28 i. Patient safety work product for purposes of the federal 29 Patient Safety and Quality Improvement Act, 42 U.S.C. §299b-21 30 et seq. 31 j. Information derived from any of the health care-related 32 information listed in this subsection that is de-identified in 33 accordance with the requirements for de-identification pursuant 34 to HIPAA. 35 -7- LSB 1267SV (2) 90 es/rn 7/ 23

S.F. 262 k. Information originating from, and intermingled to be 1 indistinguishable with, or information treated in the same 2 manner as information exempt under this subsection that is 3 maintained by a covered entity or business associate as defined 4 by HIPAA or a program or a qualified service organization as 5 defined by 42 U.S.C. §290dd-2. 6 l. Information used only for public health activities and 7 purposes as authorized by HIPAA. 8 m. The collection, maintenance, disclosure, sale, 9 communication, or use of any personal information bearing on a 10 consumer’s credit worthiness, credit standing, credit capacity, 11 character, general reputation, personal characteristics, or 12 mode of living by a consumer reporting agency or furnisher that 13 provides information for use in a consumer report, and by a 14 user of a consumer report, but only to the extent that such 15 activity is regulated by and authorized under the federal Fair 16 Credit Reporting Act, 15 U.S.C. §1681 et seq. 17 n. Personal data collected, processed, sold, or disclosed in 18 compliance with the federal Driver’s Privacy Protection Act of 19 1994, 18 U.S.C. §2721 et seq. 20 o. Personal data regulated by the federal Family Educational 21 Rights and Privacy Act, 20 U.S.C. §1232 et seq. 22 p. Personal data collected, processed, sold, or disclosed in 23 compliance with the federal Farm Credit Act, 12 U.S.C. §2001 24 et seq. 25 q. Data processed or maintained as follows: 26 (1) In the course of an individual applying to, employed 27 by, or acting as an agent or independent contractor of a 28 controller, processor, or third party, to the extent that the 29 data is collected and used within the context of that role. 30 (2) As the emergency contact information of an individual 31 under this chapter used for emergency contact purposes. 32 (3) That is necessary to retain to administer benefits 33 for another individual relating to the individual under 34 subparagraph (1) and used for the purposes of administering 35 -8- LSB 1267SV (2) 90 es/rn 8/ 23

S.F. 262 those benefits. 1 r. Personal data used in accordance with the federal 2 Children’s Online Privacy Protection Act, 15 U.S.C. §6501 – 3 6506, and its rules, regulations, and exceptions thereto. 4 Sec. 3. NEW SECTION . 715D.3 Consumer data rights. 5 1. A consumer may invoke the consumer rights authorized 6 pursuant to this section at any time by submitting a request to 7 the controller, through the means specified by the controller 8 pursuant to section 715D.4, subsection 6, specifying the 9 consumer rights the consumer wishes to invoke. A known child’s 10 parent or legal guardian may invoke such consumer rights 11 on behalf of the known child regarding processing personal 12 data belonging to the child. A controller shall comply with 13 an authenticated consumer request to exercise all of the 14 following: 15 a. To confirm whether a controller is processing the 16 consumer’s personal data and to access such personal data. 17 b. To delete personal data provided by the consumer. 18 c. To obtain a copy of the consumer’s personal data, except 19 as to personal data that is defined as “personal information” 20 pursuant to section 715C.1 that is subject to security breach 21 protection, that the consumer previously provided to the 22 controller in a portable and, to the extent technically 23 practicable, readily usable format that allows the consumer 24 to transmit the data to another controller without hindrance, 25 where the processing is carried out by automated means. 26 d. To opt out of the sale of personal data. 27 2. Except as otherwise provided in this chapter, a 28 controller shall comply with a request by a consumer to 29 exercise the consumer rights authorized pursuant to this 30 section as follows: 31 a. A controller shall respond to the consumer without 32 undue delay, but in all cases within ninety days of receipt 33 of a request submitted pursuant to the methods described in 34 this section. The response period may be extended once by 35 -9- LSB 1267SV (2) 90 es/rn 9/ 23

S.F. 262 forty-five additional days when reasonably necessary upon 1 considering the complexity and number of the consumer’s 2 requests by informing the consumer of any such extension within 3 the initial ninety-day response period, together with the 4 reason for the extension. 5 b. If a controller declines to take action regarding the 6 consumer’s request, the controller shall inform the consumer 7 without undue delay of the justification for declining to take 8 action, except in the case of a suspected fraudulent request, 9 in which case the controller may state that the controller was 10 unable to authenticate the request. The controller shall also 11 provide instructions for appealing the decision pursuant to 12 subsection 3. 13 c. Information provided in response to a consumer request 14 shall be provided by a controller free of charge, up to 15 twice annually per consumer. If a request from a consumer 16 is manifestly unfounded, excessive, repetitive, technically 17 unfeasible, or the controller reasonably believes that the 18 primary purpose of the request is not to exercise a consumer 19 right, the controller may charge the consumer a reasonable fee 20 to cover the administrative costs of complying with the request 21 or decline to act on the request. The controller bears the 22 burden of demonstrating the manifestly unfounded, excessive, 23 repetitive, or technically unfeasible nature of the request. 24 d. If a controller is unable to authenticate a request 25 using commercially reasonable efforts, the controller shall 26 not be required to comply with a request to initiate an action 27 under this section and may request that the consumer provide 28 additional information reasonably necessary to authenticate the 29 consumer and the consumer’s request. 30 3. A controller shall establish a process for a consumer 31 to appeal the controller’s refusal to take action on a request 32 within a reasonable period of time after the consumer’s 33 receipt of the decision pursuant to this section. The appeal 34 process shall be conspicuously available and similar to the 35 -10- LSB 1267SV (2) 90 es/rn 10/ 23

S.F. 262 process for submitting requests to initiate action pursuant 1 to this section. Within sixty days of receipt of an appeal, 2 a controller shall inform the consumer in writing of any 3 action taken or not taken in response to the appeal, including 4 a written explanation of the reasons for the decision. If 5 the appeal is denied, the controller shall also provide the 6 consumer with an online mechanism through which the consumer 7 may contact the attorney general to submit a complaint. 8 Sec. 4. NEW SECTION . 715D.4 Data controller duties. 9 1. A controller shall adopt and implement reasonable 10 administrative, technical, and physical data security practices 11 to protect the confidentiality, integrity, and accessibility 12 of personal data. Such data security practices shall be 13 appropriate to the volume and nature of the personal data at 14 issue. 15 2. A controller shall not process sensitive data collected 16 from a consumer for a nonexempt purpose without the consumer 17 having been presented with clear notice and an opportunity to 18 opt out of such processing, or, in the case of the processing 19 of sensitive data concerning a known child, without processing 20 such data in accordance with the federal Children’s Online 21 Privacy Protection Act, 15 U.S.C. §6501 et seq. 22 3. A controller shall not process personal data in 23 violation of state and federal laws that prohibit unlawful 24 discrimination against a consumer. A controller shall not 25 discriminate against a consumer for exercising any of the 26 consumer rights contained in this chapter, including denying 27 goods or services, charging different prices or rates for 28 goods or services, or providing a different level of quality 29 of goods and services to the consumer. However, nothing in 30 this chapter shall be construed to require a controller to 31 provide a product or service that requires the personal data 32 of a consumer that the controller does not collect or maintain 33 or to prohibit a controller from offering a different price, 34 rate, level, quality, or selection of goods or services to a 35 -11- LSB 1267SV (2) 90 es/rn 11/ 23

S.F. 262 consumer, including offering goods or services for no fee, 1 if the consumer has exercised the consumer’s right to opt 2 out pursuant to section 715D.3 or the offer is related to a 3 consumer’s voluntary participation in a bona fide loyalty, 4 rewards, premium features, discounts, or club card program. 5 4. Any provision of a contract or agreement that purports to 6 waive or limit in any way consumer rights pursuant to section 7 715D.3 shall be deemed contrary to public policy and shall be 8 void and unenforceable. 9 5. A controller shall provide consumers with a reasonably 10 accessible, clear, and meaningful privacy notice that includes 11 the following: 12 a. The categories of personal data processed by the 13 controller. 14 b. The purpose for processing personal data. 15 c. How consumers may exercise their consumer rights pursuant 16 to section 715D.3, including how a consumer may appeal a 17 controller’s decision with regard to the consumer’s request. 18 d. The categories of personal data that the controller 19 shares with third parties, if any. 20 e. The categories of third parties, if any, with whom the 21 controller shares personal data. 22 6. If a controller sells a consumer’s personal data to third 23 parties or engages in targeted advertising, the controller 24 shall clearly and conspicuously disclose such activity, as well 25 as the manner in which a consumer may exercise the right to opt 26 out of such activity. 27 7. A controller shall establish, and shall describe in 28 a privacy notice, secure and reliable means for consumers to 29 submit a request to exercise their consumer rights under this 30 chapter. Such means shall consider the ways in which consumers 31 normally interact with the controller, the need for secure and 32 reliable communication of such requests, and the ability of 33 the controller to authenticate the identity of the consumer 34 making the request. A controller shall not require a consumer 35 -12- LSB 1267SV (2) 90 es/rn 12/ 23

S.F. 262 to create a new account in order to exercise consumer rights 1 pursuant to section 715D.3, but may require a consumer to use 2 an existing account. 3 Sec. 5. NEW SECTION . 715D.5 Processor duties. 4 1. A processor shall assist a controller in duties 5 required under this chapter, taking into account the nature of 6 processing and the information available to the processor by 7 appropriate technical and organizational measures, insofar as 8 is reasonably practicable, as follows: 9 a. To fulfill the controller’s obligation to respond to 10 consumer rights requests pursuant to section 715D.3. 11 b. To meet the controller’s obligations in relation to the 12 security of processing the personal data and in relation to the 13 notification of a security breach of the processor pursuant to 14 section 715C.2. 15 2. A contract between a controller and a processor shall 16 govern the processor’s data processing procedures with respect 17 to processing performed on behalf of the controller. The 18 contract shall clearly set forth instructions for processing 19 personal data, the nature and purpose of processing, the type 20 of data subject to processing, the duration of processing, and 21 the rights and duties of both parties. The contract shall also 22 include requirements that the processor shall do all of the 23 following: 24 a. Ensure that each person processing personal data is 25 subject to a duty of confidentiality with respect to the data. 26 b. At the controller’s direction, delete or return all 27 personal data to the controller as requested at the end of the 28 provision of services, unless retention of the personal data 29 is required by law. 30 c. Upon the reasonable request of the controller, make 31 available to the controller all information in the processor’s 32 possession necessary to demonstrate the processor’s compliance 33 with the obligations in this chapter. 34 d. Engage any subcontractor or agent pursuant to a written 35 -13- LSB 1267SV (2) 90 es/rn 13/ 23

S.F. 262 contract in accordance with this section that requires the 1 subcontractor to meet the duties of the processor with respect 2 to the personal data. 3 3. Nothing in this section shall be construed to relieve a 4 controller or a processor from imposed liabilities by virtue 5 of the controller or processor’s role in the processing 6 relationship as defined by this chapter. 7 4. Determining whether a person is acting as a controller or 8 processor with respect to a specific processing of data is a 9 fact-based determination that depends upon the context in which 10 personal data is to be processed. A processor that continues 11 to adhere to a controller’s instructions with respect to a 12 specific processing of personal data remains a processor. 13 Sec. 6. NEW SECTION . 715D.6 Processing data —— exemptions. 14 1. Nothing in this chapter shall be construed to require the 15 following: 16 a. A controller or processor to re-identify de-identified 17 data or pseudonymous data. 18 b. Maintaining data in identifiable form. 19 c. Collecting, obtaining, retaining, or accessing any 20 data or technology, in order to be capable of associating an 21 authenticated consumer request with personal data. 22 2. Nothing in this chapter shall be construed to require 23 a controller or processor to comply with an authenticated 24 consumer rights request, pursuant to section 715D.3, if all of 25 the following apply: 26 a. The controller is not reasonably capable of associating 27 the request with the personal data or it would be unreasonably 28 burdensome for the controller to associate the request with the 29 personal data. 30 b. The controller does not use the personal data to 31 recognize or respond to the specific consumer who is the 32 subject of the personal data, or associate the personal data 33 with other personal data about the same specific consumer. 34 c. The controller does not sell the personal data to any 35 -14- LSB 1267SV (2) 90 es/rn 14/ 23

S.F. 262 third party or otherwise voluntarily disclose the personal data 1 to any third party other than a processor, except as otherwise 2 permitted in this chapter. 3 3. Consumer rights contained in sections 715D.3 and 715D.4 4 shall not apply to pseudonymous data in cases where the 5 controller is able to demonstrate any information necessary 6 to identify the consumer is kept separately and is subject to 7 appropriate technical and organizational measures to ensure 8 that the personal data is not attributed to an identified or 9 identifiable natural person. 10 4. Controllers that disclose pseudonymous data or de- 11 identified data shall exercise reasonable oversight to monitor 12 compliance with any contractual commitments to which the 13 pseudonymous data or de-identified data is subject and shall 14 take appropriate steps to address any breaches of those 15 contractual commitments. 16 Sec. 7. NEW SECTION . 715D.7 Limitations. 17 1. Nothing in this chapter shall be construed to restrict a 18 controller’s or processor’s ability to do the following: 19 a. Comply with federal, state, or local laws, rules, or 20 regulations. 21 b. Comply with a civil, criminal, or regulatory inquiry, 22 investigation, subpoena, or summons by federal, state, local, 23 or other governmental authorities. 24 c. Cooperate with law enforcement agencies concerning 25 conduct or activity that the controller or processor reasonably 26 and in good faith believes may violate federal, state, or local 27 laws, rules, or regulations. 28 d. Investigate, establish, exercise, prepare for, or defend 29 legal claims. 30 e. Provide a product or service specifically requested by a 31 consumer or parent or guardian of a child, perform a contract 32 to which the consumer or parent or guardian of a child is a 33 party, including fulfilling the terms of a written warranty, or 34 take steps at the request of the consumer or parent or guardian 35 -15- LSB 1267SV (2) 90 es/rn 15/ 23

S.F. 262 of a child prior to entering into a contract. 1 f. Take immediate steps to protect an interest that is 2 essential for the life or physical safety of the consumer or 3 of another natural person, and where the processing cannot be 4 manifestly based on another legal basis. 5 g. Prevent, detect, protect against, or respond to security 6 incidents, identity theft, fraud, harassment, malicious or 7 deceptive activities, or any illegal activity. 8 h. Preserve the integrity or security of systems. 9 i. Investigate, report, or prosecute those responsible for 10 any such action. 11 j. Engage in public or peer-reviewed scientific or 12 statistical research in the public interest that adheres to 13 all other applicable ethics and privacy laws and is approved, 14 monitored, and governed by an institutional review board, or 15 similar independent oversight entities that determine the 16 following: 17 (1) If the deletion of the information is likely to provide 18 substantial benefits that do not exclusively accrue to the 19 controller. 20 (2) The expected benefits of the research outweigh the 21 privacy risks. 22 (3) If the controller has implemented reasonable safeguards 23 to mitigate privacy risks associated with research, including 24 any risks associated with re-identification. 25 k. Assist another controller, processor, or third party with 26 any of the obligations under this subsection. 27 2. The obligations imposed on a controller or processor 28 under this chapter shall not restrict a controller’s or 29 processor’s ability to collect, use, or retain data as follows: 30 a. To conduct internal research to develop, improve, or 31 repair products, services, or technology. 32 b. To effectuate a product recall. 33 c. To identify and repair technical errors that impair 34 existing or intended functionality. 35 -16- LSB 1267SV (2) 90 es/rn 16/ 23

S.F. 262 d. To perform internal operations that are reasonably 1 aligned with the expectations of the consumer or reasonably 2 anticipated based on the consumer’s existing relationship with 3 the controller or are otherwise compatible with processing 4 data in furtherance of the provision of a product or service 5 specifically requested by a consumer or parent or guardian of a 6 child or the performance of a contract to which the consumer or 7 parent or guardian of a child is a party. 8 3. The obligations imposed on controllers or processors 9 under this chapter shall not apply where compliance by the 10 controller or processor with this chapter would violate an 11 evidentiary privilege under the laws of the state. Nothing 12 in this chapter shall be construed to prevent a controller or 13 processor from providing personal data concerning a consumer to 14 a person covered by an evidentiary privilege under the laws of 15 the state as part of a privileged communication. 16 4. A controller or processor that discloses personal data 17 to a third-party controller or processor, in compliance with 18 the requirements of this chapter, is not in violation of 19 this chapter if the third-party controller or processor that 20 receives and processes such personal data is in violation of 21 this chapter, provided that, at the time of disclosing the 22 personal data, the disclosing controller or processor did not 23 have actual knowledge that the recipient intended to commit a 24 violation. A third-party controller or processor receiving 25 personal data from a controller or processor in compliance with 26 the requirements of this chapter is likewise not in violation 27 of this chapter for the offenses of the controller or processor 28 from which it receives such personal data. 29 5. Nothing in this chapter shall be construed as an 30 obligation imposed on a controller or a processor that 31 adversely affects the privacy or other rights or freedoms 32 of any persons, such as exercising the right of free speech 33 pursuant to the first amendment to the United States 34 Constitution, or applies to personal data by a person in the 35 -17- LSB 1267SV (2) 90 es/rn 17/ 23

S.F. 262 course of a purely personal or household activity. 1 6. Personal data processed by a controller pursuant to 2 this section shall not be processed for any purpose other than 3 those expressly listed in this section unless otherwise allowed 4 by this chapter. Personal data processed by a controller 5 pursuant to this section may be processed to the extent that 6 such processing is as follows: 7 a. Reasonably necessary and proportionate to the purposes 8 listed in this section. 9 b. Adequate, relevant, and limited to what is necessary 10 in relation to the specific purposes listed in this section. 11 Personal data collected, used, or retained pursuant to 12 this section shall, where applicable, take into account 13 the nature and purpose or purposes of such collection, use, 14 or retention. Such data shall be subject to reasonable 15 administrative, technical, and physical measures to protect the 16 confidentiality, integrity, and accessibility of the personal 17 data. 18 7. If a controller processes personal data pursuant to an 19 exemption in this section, the controller bears the burden of 20 demonstrating that such processing qualifies for the exemption 21 and complies with the requirements in subsection 6. 22 8. Processing personal data for the purposes expressly 23 identified in subsection 1 shall not in and of itself make an 24 entity a controller with respect to such processing. 25 9. This chapter shall not require a controller, processor, 26 third party, or consumer to disclose trade secrets. 27 Sec. 8. NEW SECTION . 715D.8 Enforcement —— penalties. 28 1. The attorney general shall have exclusive authority to 29 enforce the provisions of this chapter. Whenever the attorney 30 general has reasonable cause to believe that any person has 31 engaged in, is engaging in, or is about to engage in any 32 violation of this chapter, the attorney general is empowered to 33 issue a civil investigative demand. The provisions of section 34 685.6 shall apply to civil investigative demands issued under 35 -18- LSB 1267SV (2) 90 es/rn 18/ 23

S.F. 262 this chapter. 1 2. Prior to initiating any action under this chapter, 2 the attorney general shall provide a controller or processor 3 ninety days’ written notice identifying the specific provisions 4 of this chapter the attorney general alleges have been or 5 are being violated. If within the ninety-day period, the 6 controller or processor cures the noticed violation and 7 provides the attorney general an express written statement that 8 the alleged violations have been cured and that no further such 9 violations shall occur, no action shall be initiated against 10 the controller or processor. 11 3. If a controller or processor continues to violate this 12 chapter following the cure period in subsection 2 or breaches 13 an express written statement provided to the attorney general 14 under that subsection, the attorney general may initiate an 15 action in the name of the state and may seek an injunction to 16 restrain any violations of this chapter and civil penalties of 17 up to seven thousand five hundred dollars for each violation 18 under this chapter. Any moneys collected under this section 19 including civil penalties, costs, attorney fees, or amounts 20 which are specifically directed shall be paid into the consumer 21 education and litigation fund established under section 22 714.16C. 23 4. Nothing in this chapter shall be construed as providing 24 the basis for, or be subject to, a private right of action for 25 violations of this chapter or under any other law. 26 Sec. 9. NEW SECTION . 715D.9 Preemption. 27 1. This chapter supersedes and preempts all rules, 28 regulations, codes, ordinances, and other laws adopted by a 29 city, county, municipality, or local agency regarding the 30 processing of personal data by controllers or processors. 31 2. Any reference to federal, state, or local law or statute 32 in this chapter shall be deemed to include any accompanying 33 rules or regulations or exemptions thereto, or in the case of a 34 federal agency, guidance issued by such agency thereto. 35 -19- LSB 1267SV (2) 90 es/rn 19/ 23

S.F. 262 Sec. 10. EFFECTIVE DATE. This Act takes effect January 1, 1 2025. 2 EXPLANATION 3 The inclusion of this explanation does not constitute agreement with 4 the explanation’s substance by the members of the general assembly. 5 This bill relates to consumer data protection. 6 The bill contains several definitions. The bill defines 7 “controller” to mean a person that, alone or jointly with 8 others, determines the purpose and means of processing personal 9 data. The bill defines “identified or identifiable natural 10 person” to mean a person who can be readily identified, 11 directly or indirectly. The bill defines “personal data” to 12 mean any information that is linked or reasonably linkable to 13 an identified or identifiable natural person, but does not 14 include de-identified data or publicly available information. 15 The bill defines “process” or “processing” to mean any 16 operation or set of operations performed, whether by manual or 17 automated means, on personal data or on sets of personal data, 18 such as the collection, use, storage, disclosure, analysis, 19 deletion, or modification of personal data. The bill defines 20 “processor” to mean a person that processes personal data 21 on behalf of a controller. The bill defines “pseudonymous 22 data” to mean personal data that cannot be attributed to 23 a specific natural person without the use of additional 24 information. The bill defines “publicly available information” 25 to mean information that is lawfully made available to the 26 general public through certain records or information that 27 a business has reasonable basis to believe is lawfully made 28 available under certain conditions. The bill defines “targeted 29 advertising” to mean displaying advertisements to a consumer 30 where the advertisement is selected based on personal data 31 obtained from that consumer’s activities over time and across 32 nonaffiliated websites or online applications to predict such 33 consumer’s preferences or interests, with exceptions. The bill 34 defines “third party” to mean a natural or legal person, public 35 -20- LSB 1267SV (2) 90 es/rn 20/ 23