Nebraska Addresses Children’s Online Privacy

Earlier this year, Nebraska became the third state to pass age-appropriate design code legislation (joining California and Maryland), which reflects a growing concern among states over how online platforms handle the personal data of minors.  Age-appropriate design code laws are designed to introduce safeguards to protect children’s personal data from targeted advertising practices.

On May 30th, Governor Pillen signed into law the Age Appropriate Online Design Code Act (the “Act”), which is modeled in part on the California Age-Appropriate Design Code Act, which requires providers of online services to implement features designed to reduce harm resulting from compulsive use of the service, protect users data, and allow parents to access their child’s privacy and account settings. 

The Act applies to any online service that conducts business in Nebraska and:

• generates annual revenue exceeding $25 million dollars;
• processes personal data of 50,00 or more consumers, households, or devices on an annual basis; and
• derives at least 50% of its annual revenue from the sale or sharing of consumers data.

The Act contains an “actual knowledge” standard, exempting those online services that possess actual knowledge that fewer than two percent of its users are minors.

Among other obligations, the Act requires covered online services to provide minors with accessible and easy-to-use tools that:

• allow minors to opt out of all in-game purchases and transactions
• limit communication with the minor by other users or visitors
• restrict other individuals from viewing the minor’s personal data
• restrict the sharing of a minor’s precise geolocation and provide  an “obvious signal” when the minor’s precise geolocation information is being collected or when parental monitoring is being used
• control personalized recommendations by allowing a minor to opt in to a chronological feed or by categories of content from being recommended
• allow minors to opt out of covered design features that are unnecessary to provide the online service

The Act also contains an outright prohibition of “dark patterns,” by prohibiting any user interface that has the effect of subverting or impairing autonomy, decision-making, or choice. 

The Act is slated to go into effect on January 1, 2026.  However, the Act gives companies some leeway, as the Attorney General (who has sole enforcement authority) cannot bring enforcement actions until July 1, 2026.   A violation of the Act constitutes a deceptive trade practice under the Nebraska’s Uniform Deceptive Trade Practices Act and can result in penalties of up to $50,000 per violation.