Need to balance data privacy with small business growth

Data privacy has emerged as a growing concern in the digital age, prompting states to enact laws that protect consumer information while preserving the online marketplaces that are the bedrock of our economies. While the intentions behind these measures are laudable, the scope and impact of such laws must be carefully considered to avoid disrupting online marketing, which is key to growth for small and large businesses alike. should be considered.

The impact on small businesses is especially significant in Maine, where more than 80% of our businesses are classified as small and form the backbone of our economy. Sensitive personal data should be protected, and the Maine Chamber of Commerce supports common-sense reforms enacted in other states. However, any law adopted by Maine must protect businesses' ability to compete and attract customers around the world through targeted marketing and e-commerce. We can do both, but unfortunately Congress's commitment to privacy could cut off Maine businesses from the global online marketplace.

Last year, two bills aimed at addressing data privacy were introduced in the Maine Legislature. Her LD 1973, sponsored by Senator Lisa Keim, and LD 1977, sponsored by Congresswoman Maggie O'Neill. Congress' Joint Standing Committee on the Judiciary has worked with bill sponsors over the past several months to consider the intricacies of these policy proposals and find common ground.

With no federal policy in place, 14 states have enacted consumer data privacy laws, 13 of which share what is known as the “Connecticut Framework.” Like these states, Maine is currently at a crossroads regarding data privacy laws.

Small businesses drive local economies, create jobs, and are catalysts for innovation and entrepreneurship in Maine. Policies that affect them must be approached carefully and thoughtfully. According to the U.S. Chamber of Commerce's Technology Engagement Center report, “Empowering Small Businesses: The Impact of Technology on U.S. Small Businesses,” 87% of small businesses credit technology platforms with improving operational efficiency. From online storefronts to targeted digital advertising, technology is enabling small businesses to compete in global markets. Without a doubt, technology has revolutionized the way small businesses operate. It served as a critical lifeline for many businesses during the COVID-19 pandemic.

While big tech companies are at the center of the data privacy debate, it's important to remember that small and medium-sized businesses rely on data as a critical tool to reach their target audience and grow their customer base. . A local bike repair shop, a wine bar, an outdoor retail store, or a typical Maine bed and breakfast will all be affected if they can't use the services of a big tech company to market and promote their business.

LD 1977 will directly impact companies' ability to engage in targeted marketing. For small businesses, targeted marketing ensures that your products reach the right people, rather than a broader audience with interests different from those of the product or service being advertised.

Restrictive data privacy laws not only significantly hinder companies' ability to effectively market their products and services online, but also small and medium-sized businesses, as labor shortages impact all employers. may also impede their ability to hire employees.

Data privacy is important in today's interconnected world, but policymakers must act carefully to avoid unintended consequences for Maine's small businesses. As drafted, LD 1977 would hinder the growth of e-commerce. By advocating for policies that balance consumer privacy with business needs, Maine can continue to foster a thriving entrepreneurial ecosystem while protecting sensitive consumer information.

The scope of the Maine Data Privacy and Protection Act being considered under the LD 1977 majority report would have far-reaching implications for small businesses by blocking targeted advertising. Rather than replicating the sensible protections that exist in other states, Maine is proposing to cut off our businesses from a valuable means of contacting our customers. The Maine Chamber of Commerce urges collaboration with other states to ensure the highest levels of compliance and feasibility, and to keep Maine businesses competitive.

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