New Executive Order Significantly Impacts CCPA Rulemaking

Last week California Governor Gavin Newsom took an important step to respond to the major disruption of the COVID-19 pandemic on government and business entities. By Executive Order, the governor extended the period for certification and administrative review of proposed California regulations for 60 calendar days “to allow the agencies additional time to finalize regulatory challenges pursuant to the Administrative Procedures Act.”

In California, the Office of Administrative Law has 30 working days to review and approve proposed new regulations. Extending this period for 60 calendar days virtually assures that the CCPA rulemaking will not be completed until just before – or even after – the statutorily mandated kick-off launch date for enforcement of all of the CCPA’s provisions. It is now clear that, without an enforcement moratorium until January 2, 2021 (as has been requested by ANA and 65 other major organizations), there will not be time for businesses to prepare adequately and effectively to comply with the new – yet to be finalized – CCPA rules.

Can anyone now doubt that our nation and virtually every business is facing unprecedented challenges as the COVID-19 virus continues to wreak increasing havoc on individuals, businesses, and the nation’s economy? We have never in the history of the United States had to respond simultaneously to as rapid and severe an economic downturn, while battling a crushing nationwide health crisis. This double whammy already is straining many businesses to the breaking point. We now have to accept the reality that, in every sector of our economy and in many areas of governmental oversight, business as usual no longer is a sensible or appropriate response to these extraordinary new circumstances.

Many federal and state legislative and regulatory bodies already are taking important steps to demonstrate that they are fully aware that their efforts need to be adjusted to respond to these new challenges:

• Large numbers of state legislatures have either shut down early or temporarily postponed reconvening for a lengthy period
• The United States Supreme Court has postponed a series of important oral arguments indefinitely due to the risk posed by coronavirus, which has been claimed to be the most significant disruption in the Court’s activities since the Spanish flu pandemic.
• The Federal Communications Commission, the Federal Trade Commission, the Securities and Exchange Commission, the Consumer Financial Protection Bureau, the Consumer Product Safety Commission, and the Commodity Futures Trading Commission all have either extended comment periods on proposed rules, extended the date for their enforcement, or delayed regulatory reporting requirements
• Fourteen senior Democratic House members, many of them committee chairmen, have called on the Office of Management and Budget to direct all federal agencies to immediately extend public comment periods for at least 45 days beyond the declared national emergency

In regard to the CCPA, the business community is not asking to be relieved from carrying out its requirements, but only for a short delay in enforcement. Because the complex and wide range of CCPA rulemaking issues still have not been resolved at this late date, this seems an eminently reasonable request.

Enforcing last minute regulations without giving companies time to adapt their practices accordingly is not right. It is not fair for consumers who expect standard, legally compliant responses from business. It is not fair for businesses who deserve clarity in regard to their obligations under the CCPA.

We hope that the California Attorney General will utilize reasonable discretion to delay enforcement until the beginning of next year. This will provide business adequate time to understand the final regulations and their compliance obligations, and consumers time to become aware of their rights. It will also allow their employees who are experiencing major daily disruptions in all business sectors to restore the operations that are necessary to comply with the CCPA’s requirements.

To read the full Executive Order, please click here.