The Cookie Law Explained

Ok, we’re not talking about those delicious things….we’re referring to website cookies.

NOTE: This law pertains to all EU countries, and if you do business in the EU.
Canada and the USA have no cookie laws currently. 

It started as an EU Directive that was adopted by all EU countries in May 2011. The Directive gave individuals rights to refuse the use of cookies that reduce their online privacy. Each country then updated its own laws to comply. In the UK this meant an update to the Privacy and Electronic Communications Regulations.

Why Cookie Law?

Almost all websites use cookies – little data files – to store information in peoples’ web browsers. Some websites contain hundreds of them.

There are other technologies, like Flash and HTML5 Local Storage that do similar things, and these are also covered by the legislation, but as cookies are the most common technology in use, it has become known as the Cookie Law.

What it Means For Business

If you own a website, you will need to make sure it complies with the law, and this usually means making some changes.

If you don’t comply you risk enforcement action from regulators, which in the UK means The Information Commissioners’ Office (ICO). In exceptional cases this can mean a fine.

However, non-compliance could also have other, perhaps more serious consequences than enforcement.  There is plenty of evidence that consumers avoid engaging with websites where they believe their privacy is at risk, and there is a general low level of trust about web tracking by the use of cookies.

What are Cookies Anyway?

Cookies are a kind of short term memory for the web.  They are stored in your browser and enable a site to ‘remember’ little bits of information between pages or visits.

They are widely used to make the web experience more personal, which is generally seen as a positive thing. However some cookies collect data across many websites, creating ‘behavioural profiles’ of people. These profiles can then be used to decide what content or adverts to show you. This use of cookies for targeting in particular is what the law was designed to highlight. By requiring websites to inform and obtain consent from visitors it aims to give web users more control over their online privacy.

The Benefits of Cookies

Cookies are used in many different ways, and many of them make the web experience much better. However, most of this can be summed up on one word – personalisation.

The online store Amazon is a great example of this. The more you use the site, the more Amazon understands what kind of products you search for and buy. This allows it to make recommendations of products you might like – which could help prevent extensive searching in such a big store.

If you have bought from Amazon and don’t actively sign out from your account, it will remember you when you return – greeting you by name even. It also remembers any items you have put in your shopping basket but not purchased – making it quicker to go through the checkout.

Of course they are doing it for their own benefit as well – all of this increases their sales, but it does benefit users.

In fact online shopping would not be possible without cookies. If we didn’t have cookies, you could not effectively login to a website. Instead you would have to tell it who you are every time you went to a new page, which would be extremely tedious.

Cookies can personalise a website in all sorts of other ways as well – without having to be about shopping. For example, they can be used to remember a user prefers a larger font size than normal. A news website might remember that you like certain types of stories and promote them to the home page.

There are also more subtle uses of cookies that bring benefits that are less tangible.