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Cookies could breach data laws

Ross Bentley
Companies using Internet cookies and other covert technologies to collect user information from their Web sites could be contravening the Data Protection Act.

Andrew Rigby, head of e-commerce at law firm Tarlo Lyons, warned businesses that do not understand their obligations under data protection laws about third-party hosting and maintenance of their Web sites that they could be liable to prosecution.

"They are often unaware of the use of covert technology on the site to gather data on Web site visitors without their knowledge or consent," he said. This breaches the Data Protection Act.

The focus on the Act will intensify as the first transitional period comes to an end on 23 October. "There is far more power with the consumer," Rigby explained. "Businesses that are not taking this seriously could have their Web sites shut down by the Data Protection Commissioner's Office."

A recent report from Internet intelligence specialist Cyveillance found that the use of hidden information collectors on Web sites has increased almost 500% in the past three years.

Diane Perlman, Cyveillance's marketing director, said the study, which looked at the Web sites of 50 leading brands, found that many sites have Web bugs located "only a click away from stated privacy policies."

Many of these bugs, she said, are not placed there by the owners of the Web site but through third-party data feeds and banner advert providers.

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