Clifford Chance

On March 6, 2024, New Hampshire governor Chris Sununu signed Senate Bill 255 (the New Hampshire Data Privacy Act or NHDPA), making New Hampshire the fifteenth state in the U.S. to enact comprehensive data privacy legislation. The NHDPA will take effect on January 1, 2025. The NHDPA joins the other U.S. state data privacy laws that are either in effect or will soon come into force (together with the NHDPA, the "State Data Privacy Laws"). This article summarizes key provisions of the NHDPA. 

Scope and Applicability

The NHDPA applies to persons that conduct business in New Hampshire or produce products or services targeted to residents of New Hampshire and that meet thresholds during the preceding calendar year as follows:

• control or process personal data of at least 35,000 New Hampshire consumers, other than personal data controlled or processed solely for the purpose of completing a payment transaction
• control or process personal data of at least 10,000 New Hampshire consumers and derive over twenty-five percent (25%) of their annual gross revenue from the sale of personal data.

In contrast to most other State Data Privacy Laws, the first prong of the NHDPA's applicability threshold excludes entities that process personal data of New Hampshire consumers solely for the purpose of completing a payment transaction, likely exempting many brick-and-mortar stores that only collect payment data. On the other hand, the NHDPA is similar to most other State Data Privacy Laws with respect to certain exemptions and exclusions. For example, the NHDPA only applies to personal data collected from "an individual who is a resident of [the state]" and, like most State Data Privacy Laws other than the California Consumer Privacy Act and California Privacy Rights Act, expressly excludes personal data collected or processed from individuals acting in an employment or commercial context (e.g., business-to-business activities). The NHDPA also includes exemptions in line with most other State Data Privacy Laws, such as for state political subdivisions or entities, non-profit organizations, institutions of higher education, and any information or data regulated by certain other privacy laws, including the Health Insurance Portability and Accountability Act and the Gramm-Leach-Bliley Act. 

Controller and Processor Regime

The NHDPA, like other State Data Privacy Laws, contains the regulatory framework of the European Union's General Data Protection Regulation, which distinguishes roles and responsibilities between controllers and processors. The NHDPA defines a "controller" as an individual or entity that, alone or jointly with others, determines the purpose and means of processing personal data; and a "processor" as an individual or entity that processes personal data on behalf of a controller.

The NHDPA requires controllers to provide consumers with a reasonably accessible, clear, and meaningful privacy notice, which, among other things, discloses :

• the categories of personal data processed by the controller and the purpose of such processing
• the categories of personal data and third parties with whom the controller shares personal data
• how consumers may contact the controller and exercise their privacy rights, including the appeals process. Controllers may only process personal data that is "adequate, relevant and reasonably necessary" for certain specified purposes. 

Controllers are also required to implement and maintain reasonable administrative, technical, and physical security practices to protect the confidentiality, integrity, and accessibility of personal data.

Similar to certain other State Data Privacy Laws, the NHDPA requires that controllers conduct and document data protection assessments for certain processing activity, such as targeted advertising, processing sensitive data, selling personal data, or using personal data for certain profiling purposes. A data protection assessment must identify and weigh the benefits of the processing activity with potential risks to consumers (as mitigated by the safeguards employed by the controller related to such risks). Data protection assessment obligations under the NHDPA apply to processing activities created or generated after July 1, 2024 and are not retroactive.  Notably, this date is before the NHDPA's effective date, meaning controllers may need to prepare for compliance before such assessment requirements come into effect. Controllers may also use data protection assessments created pursuant to other laws with similar requirements, including other relevant State Date Privacy Laws, for NHDPA compliance purposes.

Like most other State Data Privacy Laws, the NHDPA requires controllers and processors to enter into a written contract, which governs the processor's data processing procedures performed on behalf of the controller. These contractual provisions must clearly set out instructions for the processing of applicable data, describe the type of data subject to and the duration, nature, and purpose of such processing, and specify the rights and obligations of each party. Processors must be subject to a duty of confidentiality with respect to the applicable data and enter into subcontracts with sub-processors to ensure similar protections. Processors also must assist controllers with complying with applicable obligations under the NHDPA (e.g., responding to consumer rights requests and completing data protection assessments).

Consumer Rights and Requests

The NHDPA provides a variety of individual consumer rights that align with those found in most other State Data Privacy Laws. These rights provide consumers with a right to access, correct, delete, and obtain a copy of their personal data, and to opt-out of the selling of personal data and/or sharing of personal data for targeted advertising.

The NHDPA also permits parents and guardians to exercise rights on behalf of their children (defined by reference to COPPA (as defined below) as individuals under the age of thirteen (13)). Children's data must be processed in accordance with the Children's Online Privacy Protection Act, 15 U.S.C. § 6501 et seq. (COPPA), which requires consent from parents or guardians.

The NHDPA also grants consumers certain rights with respect to other "sensitive data." The NHDPA's definition of "sensitive data" is similar to definitions seen in most other State Data Privacy Laws, which encompass a consumer's racial or ethnic origin, religious beliefs, mental or physical health condition or diagnosis, sex life, sexual orientation, citizenship or immigration status, genetic or biometric data, children's data, and precise geolocation data. Similar to certain other State Data Privacy Laws, like the Virginia Consumer Data Protection Act, the NHDPA provides an "opt-in" regime with respect to the processing of sensitive data where controllers may not process a consumer's sensitive data "without obtaining the consumer's consent" (or in accordance with COPPA if the "sensitive data" is children's data).

Right to Appeal

Under the NHDPA, a controller must respond to a consumer's request to exercise a right within forty-five (45) days of receipt of such request. A controller can extend the response period by an additional forty-five (45) days when reasonably necessary and in consideration of the complexity and number of consumer requests received within the initial forty-five (45) day period by providing notice and an explanation to the consumer. Like most other State Data Privacy Laws, if the controller denies a consumer's request, the controller must explain the justification for the denial and include instructions for appeal that are conspicuously available and similar to the process for submitting consumer rights requests. Within sixty (60) days of receipt of an appeal request, a controller must inform the consumer of any action taken or not taken in response to the appeal. If the appeal is denied, the controller must provide the consumer with an online mechanism or other method through which the consumer may contact the New Hampshire Attorney General to submit a complaint.

Selling Personal Data

The NHDPA defines the "sale of personal data" as "the exchange of personal data for monetary or other valuable consideration by the controller to a third party." The NHDPA also provides exceptions to the "sale of personal data" in line with other State Data Privacy Laws, including a controller's disclosure of personal data:

• to a processor that processes personal data on behalf of the controller 
• to a third party for purposes of providing a product or service requested by the consumer
• to an affiliate
• at the direction of a consumer or disclosure of personal data that the consumer intentionally made available to the general public and did not restrict to a specific audience
• for the purpose of a proposed or completed merger, acquisition, bankruptcy, or similar transaction.

As noted above, controllers must provide consumers with the ability to opt-out of the selling of their personal data. Similar to the Connecticut Data Privacy Act and Colorado Privacy Act, controllers must provide an opt-out method that uses a preference signal sent with the consumer's consent to the controller no later than January 1, 2025. Such an opt-out method may not unfairly disadvantage another controller, must be consumer-friendly and easy to use, may not use a default setting (i.e., the opt-out mechanism must require that the consumer make an affirmative, freely given, and unambiguous choice to opt-out), and must enable the controller to accurately determine whether the consumer is a New Hampshire resident and made legitimate opt-out request.  

Targeted Advertising

The NHDPA defines "targeted advertising" as "displaying advertisements to a consumer where the advertisement is selected based on personal data obtained or inferred from that consumer's activities over time and across nonaffiliated Internet web sites or online applications to predict such consumer's preferences or interests." Like most other State Data Privacy Laws, the NHDPA expressly excludes certain activities from the definition of "targeted advertising," such as advertisements based on:

• activities within a controller's own web sites or online applications
• the context of a consumer's current search query or visit to a web site or online application
• the consumer's request for information or feedback
• processing that measures or reports the performance, reach, or frequency of an advertisement.

The NHDPA imposes the same opt-out requirements on controllers in connection with targeted advertising as it does with respect to the sale of personal data.

De-identified and Pseudonymous Data

The NHDPA defines "de-identified data" as data that cannot be used to infer information about, or otherwise be linked to, an identified or identifiable individual or device, and such data is expressly excluded from the definition of "personal data." Similar to certain other State Data Privacy Laws, the NHDPA requires that controllers in possession of de-identified data take reasonable measures to ensure that such data cannot be associated with an individual and contractually obligate any recipients of de-identified data to comply with all applicable provisions of the NHDPA. Additionally, like some other State Data Privacy Laws, such as the Virginia Consumer Data Protection Act, Utah Consumer Privacy Act, and Connecticut Data Privacy Act, the NHDPA requires controllers to "publicly commit" not to re-identify de-identified data. 

The NHDPA defines "pseudonymous data" as personal data that cannot be attributed to a specific individual without the use of additional information. Certain consumer rights (e.g., right to access, delete, opt-out, etc.) under the NHDPA do not apply to pseudonymous data if the controller demonstrates that any additional information necessary to identify the consumer is kept separately and subject to appropriate technical and organizational measures to ensure that such data is not attributed to an identified or identifiable individual.

The NHDPA requires controllers that disclose de-identified data and/or pseudonymous data to exercise reasonable oversight to monitor compliance with any contractual commitments related to such de-identified data (including avoiding attempts to re-identify such data) and/or pseudonymous data and to take appropriate actions to address any breaches of such contractual commitments.

Enforcement and Penalties

The NHDPA does not provide consumers with a private right of action. Rather, the NHDPA will be enforced by the New Hampshire Attorney General. Under the NHDPA, the New Hampshire Attorney General, prior to initiating an action, will need to first determine if a violation can be cured. If so, the New Hampshire Attorney General must send notice to the controller of the violation and provide sixty (60) days to cure the violation. If uncured, the New Hampshire Attorney General may initiate an action against the controller and/or processor. The right to cure provision sunsets on January 1, 2026, after which the New Hampshire Attorney General will have the discretion to determine whether to provide an opportunity to cure. In contrast to many other State Data Privacy Laws, the NHDPA does not expressly specify a civil penalty amount for violations; rather, violations of the NHDPA are treated as a violation of the state consumer protection statute.