How will Google's plans to retain cookies impact its relationship with regulators?

Google appeared to stump regulators on Monday when it suddenly announced that it had no plans to phase out third-party cookies in Chrome.

The UK Competition and Markets Authority (CMA) has announced that it will delay the publication of its quarterly report on the Chrome Privacy Sandbox while it assesses the situation.

The next report was due to be released later this month.

Working with the UK's data protection authority and privacy regulator, the Information Commissioner's Office (CMA), the CMA will consider the impact of Google's shocking news. Details are still unclear, but Google's proposals include introducing some sort of user choice mechanism for users of its Chrome browser instead of deleting third-party cookies entirely.

The CMA also encourages all parties and interested parties to contact the agency by August 12 and share their views.

(That sharpening sound you hear is James Rosewell sharpening his pencils.)

See you soon, CMA?

However, it is unclear what Google's change of policy on third-party cookies means for the future of its relationship with the CMA.

In 2022, Google agreed to the CMA's continued oversight of the development of the Privacy Sandbox API. The regulator took it upon itself to check whether the proposals would give Google an advantage over its competitors after Chrome removed third-party cookies. Google also said it would not phase out cookies in Chrome without the CMA's approval.

In its announcement on Monday, Google said it plans to continue investing in Privacy Sandbox.

But third-party cookies aren't going away, so the future of the Chrome Privacy Sandbox may not be dependent on the CMA's approval.

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(Re)entering ICOs

Even if the CMA is happy with user choice options and backs away from oversight of the Privacy Sandbox, the ICO could step in and express concerns about whether the Chrome Privacy Sandbox adequately protects consumer privacy.

The CMA and the ICO have worked closely together for a number of years to evaluate the Privacy Sandbox from a hybrid competition and privacy perspective.

The CMA's most recent quarterly report on the Privacy Sandbox, published in April, incorporated feedback from the ICO (which was leaked in the Journal), including concerns about the privacy and data protection implications of the sandbox API.

For example, the ICO is concerned that the Privacy Sandbox does not adequately explain to individuals how their data will be used by the Topics API, and that there may be ways to exploit flaws in PAAPI to identify anonymous users.

Therefore, even if the CMA’s work on the Privacy Sandbox is completed sooner rather than later, from a competition perspective it may be possible for the ICO to use its data privacy powers to step in and take the lead on further exploration of the sandbox.

Because, frankly, the ICO already sounds like it wants to send Google into a room without dinner and cookies.

“We are disappointed that Google has changed its plans and no longer plans to phase out third-party cookies from its Chrome browser,” ICO Deputy Chair Stephen Bonner said in a statement shared with AdExchanger.

Bonner also pointed out that ever since Google first started working on the Sandbox project 8,000 years ago (no, four years ago), the ICO's view has been that blocking third-party cookies would be a positive step for consumers.

“The new plan put forward by Google represents a significant change and we will consider this new course of action once the details become available,” Bonner said in a statement. “We will monitor how the industry responds and consider regulatory action if we find systematic non-compliance across all companies, including Google.”

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