How do EU cookie laws affect your business?

Storing user-related data is only permitted under the EU Cookie Law (also known as the ePrivacy Directive) if users give their explicit consent. This opt-in process is therefore mandatory—at least for tracking cookies if you do business in the European Union. But what is the current legal status?

What does the EU Cookie Law say?

In the European Union, Directive 2009/136/EC is intended to ensure and strengthen the protection of personal data. The cookie data law essentially requires that website visitors be clearly informed about the use of cookies and must consent to their storage.

According to the directive, cookies may only be set without prior consent if they are technically necessary—for example, to deliver a service explicitly requested by the user. This includes cookies like session cookies used to store language preferences, login credentials, or shopping cart contents, as well as Flash cookies for media playback.

However, for the use of most other cookies, website operators must obtain user consent. This applies to any cookies not essential for the operation of the website. Most notably, this includes advertising cookies used for retargeting, as well as analytics and social media cookies.

What’s included in the current EU Cookie Law

With its cookie law, the European Union aims to protect the personal data of internet users. In general, a distinction is made between technically necessary and non-essential cookies:

1. Technically necessary cookies: These include cookies that are essential for the core functions of a website. Examples include storing login credentials, shopping cart contents, or language preferences using session cookies (which are deleted when the browser is closed).
2. Non-essential cookies: These refer to text files that serve purposes beyond the website’s basic functionality. Examples include:

• Tracking cookies that collect data such as user location
• Targeting cookies that tailor advertising content to the user
• Analytics cookies that gather information about user behavior on the site
• Social media cookies that link the website with platforms like Facebook, Twitter, etc.

According to the EU Cookie Law, necessary cookies may be set without prior consent. However, visitors must give their explicit consent before non-essential cookies can store any data. As a result, the directive requires an opt-in approach for non-essential cookies. These cookies must not be set unless and until the user agrees to their use.

How U.S. businesses comply with the EU Cookie Law

U.S.-based companies that operate websites accessible to users in the European Union—or work with EU-based business partners—must ensure compliance with the EU Cookie Law and General Data Protection Regulation (GDPR). Even though the U.S. does not have a federal law equivalent to the EU’s ePrivacy Directive, American businesses are subject to these regulations when processing data from EU residents.

Key compliance measures for U.S. businesses

To align with EU cookie and data protection laws, U.S. businesses typically take the following steps:

1. Implement a cookie banner with opt-in functionality
   Users must actively consent to the use of non-essential cookies (e.g., for analytics or advertising). The banner should clearly describe the types of cookies in use and provide a way to accept or reject them.

2. Granular consent management
   Provide users with the ability to customize which types of cookies they accept (e.g., functional, analytical, marketing). This is often managed via a Consent Management Platform (CMP).

3. Maintain a detailed cookie policy
   The website should include an accessible and transparent cookie policy that explains:

   • What cookies are used
   • Their purposes and duration
   • Third-party involvement
   • How users can withdraw or modify consent

4. Geo-targeted compliance
   Some U.S. businesses choose to display consent banners only to visitors from the EU. This is achieved via IP-based geolocation tools, which help ensure that EU users receive appropriate privacy notices while avoiding unnecessary friction for U.S.-only users.

5. Documentation and recordkeeping
   Keep logs of consent records in case of audit or legal inquiry, as required by the GDPR’s accountability principle.

For a full overview of cookie restrictions and other data protection laws in the US, you can refer to the usa.gov privacy, security, and accessibility policies page.

What are cookies and what data do they collect?

Cookies are small text files that a browser stores on a user’s device when visiting a website. They save information related to your visit, enhancing user experience—for example, by remembering your login credentials or language preferences so you don’t have to re-enter them each time. While cookies provide convenience, they also raise privacy concerns. Many are used to track specific aspects of user behavior online, enabling features like personalized advertising. Tracking and targeting cookies in particular are frequently criticized by privacy advocates.

A typical cookie includes information such as the lifetime of the file and a randomly generated ID number that helps the website recognize your device. In most cases, data stored by cookies is anonymized. Personally identifiable information (PII) is only collected when a site requires you to log in.

Want to know how to delete stored cookies from your browser? Watch this video:

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What does the future hold for cookie data?

For years, the European Union has been working on the ePrivacy Regulation to establish uniform rules for the use of cookies and other tracking technologies. Originally, the ePrivacy Regulation was intended to come into force alongside the General Data Protection Regulation (GDPR), but its implementation remains uncertain.

Until the ePrivacy Regulation is formally enacted, cookies that can be used to identify users—through ID numbers, behavioral profiles, or tracking mechanisms—fall under the definition of “personal data” as outlined in Chapter 1 of the GDPR. This applies to any company—inside or outside the EU—that collects or processes such data from individuals located in the EU.

Please refer to the legal disclaimer for this article.