Are Cookies allowed under the DPDP Act?

January 30, 2024
Cookie Consent under the new DPDP Rules explained

Summary

  • Cookies are small data pieces stored by websites to remember user information and enhance online experiences.
  • Third-party cookies raise privacy concerns due to their extensive data collection without clear user consent.
  • The Digital Personal Data Protection Act requires explicit consent for processing personal data, but it's uncertain if this includes cookies.
  • If the DPDP Act applies to cookies, businesses will need to align with its consent obligations causing a dramatic shift in the world of digital advertising.
  • The future of cookies is evolving with increasing privacy regulations and technological changes, prompting a shift towards first-party data and alternative tracking technologies.

What are Cookies?

Cookies are small pieces of data stored on a user’s device by websites to remember their preferences and actions. Third-party cookies collect data on user behavior to create detailed profiles for targeted marketing.

Why is consent needed for third-party cookies?

The DPDP Act raises significant questions about whether cookies will be classified as personal data. Since cookies store information that can be used to identify and track users, businesses must comply with consent requirements before collecting data through cookies.

Are Cookies allowed under the DPDP Act? - illustration
How ads follow you everywhere - a typical flow third party cookie flow

How will businesses process cookie consent under DPDP Act?

All businesses that use cookies must provide a clear cookie notice, explaining types, purposes, and third parties involved. Users must have an explicit accept/reject option.

Are Cookies allowed under the DPDP Act? - illustration
An ideal Cookie Consent notice

Companies should start preparing by understanding the provisions of the DPDP Act and implementing necessary privacy practices.

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