What's Happening?
California has enacted a new law, the California Opt Me Out Act (AB 566), signed by Governor Gavin Newsom on October 8, 2025. This legislation requires businesses that develop or maintain web browsers
to include functionality that allows consumers to send an opt-out preference signal to website operators. This signal communicates the consumer's choice to opt out of the sale and sharing of their personal information. The law will take effect on January 1, 2027, making California the first state to implement such a requirement. The law mandates that the opt-out functionality must be easy for consumers to locate and configure. Website operators are advised to ensure their systems can accommodate these signals to comply with the new regulations.
Why It's Important?
The introduction of the California Opt Me Out Act represents a significant step in consumer privacy protection, giving individuals more control over their personal data. This law could set a precedent for other states to follow, potentially leading to broader changes in how personal data is managed across the U.S. For businesses, particularly those operating websites, this law necessitates updates to their systems to handle opt-out signals, which could involve significant technical adjustments. Failure to comply could result in legal challenges and penalties, emphasizing the importance of early adaptation to these new requirements.
What's Next?
As the law is set to take effect in 2027, businesses have time to prepare for compliance. The California Privacy Protection Agency is expected to develop regulations to guide the implementation of these requirements. Website operators should begin reviewing and updating their privacy policies and technical systems to accommodate the new opt-out signals. This proactive approach will help avoid potential legal issues once the law is in force. Additionally, other states may observe California's approach and consider similar legislation, potentially leading to a nationwide shift in consumer data privacy standards.
