[Federal Register Volume 86, Number 191 (Wednesday, October 6, 2021)]
[Notices]
[Pages 55609-55611]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-21753]


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FEDERAL TRADE COMMISSION


Agency Information Collection Activities; Proposed Collection; 
Comment Request

AGENCY: Federal Trade Commission.

ACTION: Notice.

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SUMMARY: In accordance with the Paperwork Reduction Act of 1995 
(``PRA''), the Federal Trade Commission (``FTC'' or ``Commission'') is 
seeking public comment on its proposal to extend for an additional 
three years the Office of Management and Budget clearance for 
information collection requirements in the Children's Online Privacy 
Protection Act Rule (``COPPA Rule'' or ``Rule''). The current clearance 
expires on March 31, 2022.

DATES: Comments must be filed by December 6, 2021.

ADDRESSES: Interested parties may file a comment online or on paper, by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write ``COPPA Rule: Paperwork 
Comment, FTC File No. P155408'' on your comment and file your comment 
online at https://www.regulations.gov, by following the instructions on 
the web-based form. If you prefer to file your comment on paper, mail 
your comment to the following address: Federal Trade Commission, Office 
of the Secretary, 600 Pennsylvania Avenue NW, Suite CC-5610 (Annex J), 
Washington, DC 20580, or deliver your comment to the following address: 
Federal Trade Commission, Office of the Secretary, Constitution Center, 
400 7th Street SW, 5th Floor, Suite 5610 (Annex J), Washington, DC 
20024.

FOR FURTHER INFORMATION CONTACT: Peder Magee, Attorney, (202) 326-3538, 
Division of Privacy and Identity Protection, Bureau of Consumer 
Protection, Federal Trade Commission, 600 Pennsylvania Avenue NW, 
Washington, DC 20580.

SUPPLEMENTARY INFORMATION: Title of Collection: Children's Online 
Privacy Protection Act Rule, 16 CFR part 312.
    OMB Control Number: 3084-0117.
    Type of Review: Extension of a currently approved collection.
    Affected Public: Private Sector: Businesses and other for-profit 
entities.
    Estimated Annual Burden Hours: 17,700.
    Estimated Annual Labor Costs: $5,783,700.
    Estimated Annual Non-Labor Costs: $0.
    Abstract: The COPPA Rule requires commercial websites and online 
services to provide notice and obtain parental consent before 
collecting, using, or disclosing personal information from children 
under age thirteen, with limited exceptions. The COPPA Rule contains 
certain statutorily required notice, consent, and other requirements 
that apply to operators of any commercial website or online service 
directed to children that collect personal information, and operators 
of any commercial website or online service with actual knowledge that 
it is collecting personal information from children. The Rule also 
applies to operators that collect personal information from users of 
another website or online service that is directed to children. Covered 
operators must, among other things: Provide online notice and direct 
notice to parents of how they collect, use, and disclose children's 
personal information; obtain the prior consent of the child's parent in 
order to engage in such collection, use, and disclosure; provide 
reasonable means for the parent to obtain access to the information and 
to direct its deletion; and, establish procedures that protect the 
confidentiality, security, and integrity of personal information 
collected from children.

Burden Statement

    1. Annual hours burden: 17,600 hours.

(a) New Entrant Operators' Disclosure Burden

    Based on public comments received by the Commission during its 2013 
COPPA Rule amendments rulemaking,\1\ FTC staff estimates that the Rule 
affects approximately 280 new operators per year.\2\ Staff maintains 
its longstanding estimate that new operators of websites and online 
services will require, on average, approximately 60 hours to draft a 
privacy policy, design mechanisms to provide the required online 
privacy notice and, where applicable, the direct notice to parents.\3\ 
This yields an estimated annual hours burden of 16,800 hours (280 
respondents x 60 hours).
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    \1\ 78 FR 3971, 4005 (Jan. 17, 2013).
    \2\ This consists of certain traditional website operators, 
mobile app developers, plug-in developers, and advertising networks.
    \3\ See, e.g., 80 FR 76491 (Dec. 9, 2015); 84 FR 1466 (Feb. 4, 
2019).
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(b) Safe Harbor Applicant Reporting Requirements

    Operators can comply with the COPPA Rule by meeting the terms of 
Commission-approved self-regulatory

[[Page 55610]]

program guidelines.\4\ While the submission of industry self-regulatory 
guidelines to the agency is voluntary, the COPPA Rule sets out the 
criteria for approval of guidelines and the materials that must be 
submitted as part of an application for approval of such self-
regulatory guidelines. Based on industry input, staff estimates that it 
would require, on average, 265 hours per new safe harbor program 
applicant to prepare and submit its safe harbor proposal in accordance 
with Section 312.11(c) of the Rule.\5\ Given that several safe harbor 
programs are already available to operators of websites and online 
services, FTC staff anticipates that no more than one additional safe 
harbor applicant is likely to submit a request within the next three 
years of PRA clearance. Thus, FTC staff estimates that annualized 
burden attributable to this requirement would be approximately 88 hours 
per year (265 hours / 3 years), which is rounded to 100 hours.
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    \4\ See 16 CFR 312.11(c). Approved self-regulatory guidelines 
can be found on the FTC's website at http://www.ftc.gov/privacy/privacyinitiatives/childrens_shp.html.
    \5\ See 83 FR 49557 (Oct. 2, 2018). Staff believes that most of 
the records submitted with a safe harbor request would be those that 
these entities have kept in the ordinary course of business. Under 5 
CFR 1320.3(b)(2), OMB excludes from the definition of PRA burden the 
time and financial resources needed to comply with agency-imposed 
recordkeeping, disclosure, or reporting requirements that 
customarily would be undertaken independently in the normal course 
of business.
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(c) Annual Audit and Report for Safe Harbor Programs

    The COPPA Rule requires safe harbor programs to audit their members 
and submit annual reports to the Commission on the aggregate results of 
these member audits. The burden for conducting member audits and 
preparing these reports likely varies by safe harbor program depending 
on the number of members. Commission staff estimates that conducting 
audits and preparing reports will require approximately 100 hours per 
program per year. Aggregated for one new safe harbor (100 hours) and 
six existing (600 hours) safe harbor programs, this amounts to an 
estimated cumulative reporting burden of 700 hours per year (7 
respondents x 100 hours).
    (d) Safe harbor program recordkeeping requirements
    FTC staff understands that most of the records listed in the COPPA 
Rule's safe harbor recordkeeping provisions consist of documentation 
that covered entities retain in the ordinary course of business 
irrespective of the COPPA Rule. As noted above, OMB excludes from the 
definition of PRA burden, among other things, recordkeeping 
requirements that customarily would be undertaken independently in the 
normal course of business. In staff's view, any incremental burden, 
such as that for maintaining the results of independent assessments 
under section 312.11(d), would be marginal.
    2. Estimated annual labor costs: $5,783,700.

(a) New Entrant Operators' Disclosure Burden

    Consistent with its past estimates and based on its 2013 rulemaking 
record, FTC staff assumes that the time spent on compliance for new 
operators covered by the COPPA Rule would be apportioned five to one 
between legal (outside counsel lawyers or similar professionals) and 
technical (e.g., computer programmers, software developers, and 
information security analysts) personnel. Staff therefore estimates 
that outside counsel costs will account for 14,000 of the estimated 
16,800 hours required as estimated in Section 1(a) above. Staff 
anticipates that the workload among law firm partners and associates 
for assisting with COPPA compliance would be distributed among 
attorneys at varying levels of seniority. Assuming two-thirds of such 
work is done by junior associates at a rate of approximately $300 per 
hour, and one-third by senior partners at approximately $600 per hour, 
the weighted average of outside counsel costs would be approximately 
$400 per hour.\6\ FTC staff anticipates that computer programmers 
responsible for posting privacy policies and implementing direct 
notices and parental consent mechanisms would account for the remaining 
2,800 hours. FTC staff estimates an hourly wage of $49 (rounded to the 
nearest dollar) for technical assistance, based on Bureau of Labor 
Statistics (``BLS'') data.\7\ Accordingly, associated annual labor 
costs would be $5,737,200 [(14,000 hours x $400/hour) + (2,800 hours x 
$49/hour)] for the estimated 280 new operators.
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    \6\ These estimates are drawn from the ``Laffey Matrix.'' The 
Laffey Matrix is a fee schedule used by many United States courts 
for determining the reasonable hourly rates in the District of 
Columbia for attorneys' fee awards under federal fee-shifting 
statutes. It is used here as a proxy for market rates for litigation 
counsel in the Washington, DC area. For 2020-2021, rates in table 
range from $333 per hour for most junior associates to $665 per hour 
for the most senior partners. See Laffey Matrix, Civil Division of 
the United States Attorney's Office for the District of Columbia, 
United States Attorney's Office, District of Columbia, Laffey Matrix 
B 2015-2021, available at https://www.justice.gov/usao-dc/page/file/1305941/download.
    \7\ The estimated mean hourly wages for technical labor support 
($44) is based on an average of the mean hourly wage for computer 
programmers, software developers, information security analysts, and 
web developers as reported by the Bureau of Labor statistics. See 
Occupational Employment and Wages--May 2019, Table 1 (National 
employment and wage data from the Occupational Employment Statistics 
survey by occupation, May 2019), available at https://www.bls.gov/news.release/ocwage.t01.htm (hereinafter, ``BLS Table 1'').
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(b) Safe Harbor Applicant Reporting Requirements

    Previously, industry sources have advised that all of the labor to 
comply with new safe harbor applicant requirements would be 
attributable to the efforts of in-house lawyers. See 83 FR at 49558. To 
determine in-house legal costs, FTC staff applied an approximate 
average between the BLS reported mean hourly wage for lawyers 
($69.86),\8\ and estimated in-house hourly attorney rates ($300) that 
are likely to reflect the costs associated with some safe harbor 
applicant costs. This yields an approximate hourly rate of $185. 
Applying this hourly labor cost estimate to the hours burden associated 
with approval for a new safe harbor application yields an estimated 
annual labor cost burden of $18,500 (100 hours x $185).
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    \8\ See BLS Table 1 (attorneys).
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(c) Annual Audit and Report for Safe Harbor Programs

    Commission staff assumes that compliance officers, at a mean hourly 
wage of $35, will prepare annual reports.\9\ Applying this hourly labor 
cost estimate to the hours burden associated with preparing annual 
audit reports yields an estimated annual labor cost burden of $24,500 
(700 hours x $35).
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    \9\ See BLS Table 1 (compliance officers, $35.03).
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(d) Safe Harbor Program Recordkeeping Requirements

    For the reasons stated in Section 1(d) above, FTC staff anticipates 
that the labor costs associated with safe harbor program recordkeeping 
are de minimis.
    3. Estimated annual non-labor costs: $0.
    FTC staff understands that covered operators already have in place 
the computer equipment and software necessary to comply with the Rule's 
notice requirements. Accordingly, the predominant costs incurred by 
operators are the aforementioned labor costs. Similarly, FTC staff 
anticipates that covered entities already have in place the means to 
retain and store the records that must be kept under the Rule's safe 
harbor recordkeeping provisions, because they are likely to retain such 
records independent of the Rule. Accordingly, FTC staff estimates that

[[Page 55611]]

the capital and non-labor costs associated with Rule compliance are de 
minimis.

Request for Comments

    Under the PRA, 44 U.S.C. 3501-3521, federal agencies must obtain 
approval from OMB for each collection of information they conduct or 
sponsor. ``Collection of information'' means agency requests or 
requirements that members of the public submit reports, keep records, 
or provide information to a third party. 44 U.S.C. 3502(3), 5 CFR 
1320.3(c). As required by section 3506(c)(2)(A) of the PRA, the FTC is 
providing this opportunity for public comment before requesting that 
OMB extend the existing PRA clearance for the COPPA Rule.
    Pursuant to Section 3506(c)(2)(A) of the PRA, the FTC invites 
comments on: (1) Whether the disclosure requirements are necessary, 
including whether the information will be practically useful; (2) the 
accuracy of our burden estimates, including whether the methodology and 
assumptions used are valid; (3) ways to enhance the quality, utility, 
and clarity of the information to be collected; and (4) ways to 
minimize the burden of providing the required information to consumers. 
All comments should be filed as prescribed in the ADDRESSES section 
above, and must be received on or before December 6, 2021.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before December 6, 
2021. Write ``Paperwork Reduction Act: FTC File No. P072108'' on your 
comment. Your comment, including your name and your state--will be 
placed on the public record of this proceeding, including the https://www.regulations.gov website.
    Due to the public health emergency in response to the COVID-19 
outbreak and the agency's heightened security screening, postal mail 
addressed to the Commission will be subject to delay. We encourage you 
to submit your comments online through the https://www.regulations.gov 
website.
    If you prefer to file your comment on paper, write ``Paperwork 
Reduction Act: FTC File No. P072108'' on your comment and on the 
envelope, and mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite 
CC-5610 (Annex J), Washington, DC 20580, or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610, 
Washington, DC 20024. If possible, please submit your paper comment to 
the Commission by courier or overnight service.
    Because your comment will become publicly available at https://www.regulations.gov, you are solely responsible for making sure that 
your comment does not include any sensitive or confidential 
information. In particular, your comment should not include any 
sensitive personal information, such as your or anyone else's Social 
Security number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. You are also 
solely responsible for making sure that your comment does not include 
any sensitive health information, such as medical records or other 
individually identifiable health information. In addition, your comment 
should not include any ``trade secret or any commercial or financial 
information which . . . is privileged or confidential''--as provided by 
Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 
16 CFR 4.10(a)(2)--including in particular competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular, 
the written request for confidential treatment that accompanies the 
comment must include the factual and legal basis for the request, and 
must identify the specific portions of the comment to be withheld from 
the public record. See FTC Rule 4.9(c). Your comment will be kept 
confidential only if the General Counsel grants your request in 
accordance with the law and the public interest. Once your comment has 
been posted on the public website--as legally required by FTC Rule 
4.9(b)--we cannot redact or remove your comment from the website, 
unless you submit a confidentiality request that meets the requirements 
for such treatment under FTC Rule 4.9(c), and the General Counsel 
grants that request.
    The FTC Act and other laws that the Commission administers permit 
the collection of public comments to consider and use in this 
proceeding as appropriate. The Commission will consider all timely and 
responsive public comments that it receives on or before December 6, 
2021. For information on the Commission's privacy policy, including 
routine uses permitted by the Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Josephine Liu,
Assistant General Counsel for Legal Counsel.
[FR Doc. 2021-21753 Filed 10-5-21; 8:45 am]
BILLING CODE 6750-01-P