What role do cookies play in modern privacy compliance?

In today's digital economy, websites and mobile applications collect personal data to improve user experiences, deliver personalised content, and support marketing activities. Cookies and similar tracking technologies are one of the primary tools used for such data collection. While these technologies provide significant business benefits, they also raise privacy concerns. Organisations must ensure they obtain valid user consent and remain compliant with cookie-related requirements. This has made consent management and cookie compliance essential components of modern privacy programs.

Understanding Cookies and Tracking Technologies

Cookies are small text files that websites save on a user's device when they visit a site. They help the website remember things such as login details, language or display preferences, items added to a shopping cart, and browsing activity. In addition to cookies, organisations use other technologies, such as tools that track user interactions, analyse behaviour, monitor activity, and improve their products and services, to understand how people use websites and mobile apps.

Cookies are generally categorised into the following types:

Strictly Necessary Cookies: Required for website functionality, security, and user authentication.

Functional Cookies: Enable enhanced website features and personalisation, and typically require user consent before deployment.

Analytics Cookies: Collect information about user behaviour and website performance.

Advertising or Marketing Cookies: Track users across websites to deliver targeted advertisements. In some countries, essential cookies that are needed for a website to function can be used without asking for consent. However, cookies used for tracking or advertising usually require the user's consent before they are placed on the device.

What is Consent Management?

Consent management is the process of obtaining, recording, managing, and demonstrating user consent for personal data collection and processing. It gives individuals control over how their information is used and helps organisations prove compliance with applicable privacy laws.

A robust consent management framework includes:

• Provide users with clear information about how their data is collected and used.
• Giving users clear and genuine options to make their own choices.
• Giving users the option to choose which types of cookies they want to allow or block.
• Keeping a record of users' consent choices.
• Enabling users to withdraw consent easily.
• Maintaining audit trails for regulatory compliance.

Organisations often implement these requirements through Consent Management Platforms (CMPs) to make it easier to automatically collect, manage, and update users' consent preferences.

Regulatory Landscape for Cookie Compliance

Many privacy laws and regulations around the world set rules on how organisations can use cookies and manage user consent.

European Union – GDPR

The General Data Protection Regulation (GDPR) establishes some of the strictest cookie compliance requirements globally.

Under these regulations:

• Consent must be freely given, specific, informed, and unambiguous.
• Users must take a clear affirmative action to provide consent.
• Pre-ticked boxes are not permitted.
• Users must be able to withdraw consent as easily as they gave it.
• Non-essential cookies cannot be placed before consent is obtained.

Organisations serving EU residents must ensure that cookie banners and consent mechanisms meet these standards.

India – Digital Personal Data Protection Act (DPDP Act)

While the DPDP Act does not specifically regulate cookies, it requires valid consent for processing personal data. If cookies collect information that can identify an individual or be linked to a person, organisations may need to obtain consent and provide appropriate privacy notices.

As India's privacy laws continue to develop, the use of cookies is likely to face increased regulatory attention, especially when they are used for online advertising and tracking users' behaviour on websites.

United States

Several state privacy laws, including the California Consumer Privacy Act (CCPA) and the California Privacy Rights Act (CPRA), provide consumers with rights regarding data collection and targeted advertising.

Organisations may need to offer opt-out mechanisms for certain tracking activities and provide transparency regarding data-sharing practices.

Characteristics of Valid Consent

Obtaining valid consent involves more than simply displaying a cookie banner. Regulators increasingly scrutinise consent mechanisms to ensure they genuinely empower users.

Valid consent should be:

Informed

Users must understand what data is being collected, why it is being collected, and who will receive it.

Specific

Consent should be obtained for distinct processing purposes. For example, analytics cookies and advertising cookies should be presented separately.

Freely Given

Users should not be forced to accept unnecessary cookies to access basic website functionality.

Unambiguous

Consent must result from a clear affirmative action, such as clicking an "Accept" button.

Revocable

Users should be able to change their preferences and withdraw consent at any time.

Cookie Banners and Preference Centres

Cookie banners have become a common feature of websites worldwide. However, simply displaying a banner is not enough to achieve compliance.

An effective cookie banner should:

• Clearly explain the purpose of cookies.
• Provide options to accept, reject, or customise preferences.
• Avoid deceptive design practices; users should be given clear, transparent, and equal choices regarding the use of cookies and other tracking technologies. This helps ensure that consent is freely given, informed, and genuine.
• The Cookie banner should link to a detailed cookie policy. Providing a clear and accessible cookie policy helps users understand the website's data collection practices and supports transparency and informed consent.

Many organisations also implement preference centres where users can review and modify their consent choices at any time. For example, an e-commerce website may allow users to accept necessary cookies while declining marketing cookies. The website must respect that choice and refrain from placing marketing trackers on the user's device.

Common Compliance Issues

Many organisations struggle with cookie compliance due to complex technology environments and evolving regulatory expectations.

Lack of Cookie Visibility

Organisations often do not know all the cookies operating on their websites, especially when third-party services are involved. Regular website audits and continuous monitoring are therefore essential to ensure transparency and provide users with accurate cookie information.

Third-Party Tracking

Advertising networks, social media platforms, and analytics service providers may place their own cookies on websites, which can create privacy and compliance challenges for organisations.

Inconsistent Consent Records

Without proper systems, organisations may be unable to demonstrate when and how consent was obtained. To address this challenge, many organisations use Consent Management Platforms (CMPs) or similar tools that automatically record, store, and manage consent preferences, creating an audit trail that can be produced when required.

Dark Patterns

Some websites use design techniques that make it easy for users to accept cookies but difficult to reject them. Regulators are increasingly considering these practices as unfair and not a valid way of obtaining user consent.

Changing Regulations

Privacy laws continue to evolve, requiring organisations to timely review and update their consent management practices.

Good Practices for Cookie Consent and Compliance

Organisations can strengthen compliance by adopting the following best practices:

Conduct Regular Cookie Audits

Identify all cookies and tracking technologies operating across websites and applications. Document their purpose, duration, and providers.

Categorise Cookies Properly

Classify cookies as necessary, functional, analytics, or marketing to support informed user choices.

Implement a Consent Management Platform

CMPs help automate consent collection, preference management, and audit logging.

Maintain Detailed Records

Store evidence of consent, including timestamps, user preferences, and notice versions displayed at the time consent was obtained, means that organisations should maintain detailed records of the consent provided by users. These records serve as proof that consent was collected lawfully and transparently and can be used to demonstrate compliance during audits, investigations, or regulatory reviews.

Review Third-Party Vendors

Ensure that advertising partners, analytics providers, and other vendors comply with applicable privacy requirements.

Provide Easy Withdrawal Mechanisms

Users should be able to revisit their preferences and modify consent settings without difficulty.

Update Cookie Policies

Cookie policies should accurately describe current tracking practices and be reviewed periodically.

The Future of Consent and Cookies

The digital advertising industry is changing rapidly. As the use of third-party cookies decreases and people become more concerned about their privacy, organisations are adopting new ways to collect and use data.

Instead of relying on third-party cookies, businesses are increasingly collecting information directly from their customers through transparent communication and by obtaining proper consent. This approach not only helps organisations comply with privacy laws but also strengthens customer trust. As privacy expectations continue to evolve, organisations that prioritise transparency, consent and responsible data use will be better positioned for the future.

In the future, organisations are expected to make greater use of tools that help manage consent and user preferences across different websites, applications, and platforms. They are also likely to adopt privacy-enhancing technologies that protect personal information while supporting business needs and regulatory compliance.

Conclusion

Consent management and cookie compliance have become critical components of modern privacy governance. Generic cookie banners are unreliable, and organisations cannot assume that users understand complex tracking practices. Instead, they must provide clear information, obtain valid consent, respect user choices, and maintain robust records of consent decisions.

As privacy regulations continue to evolve and consumers become more aware of their rights, organisations that prioritise transparency and user control will be better positioned to build trust, reduce regulatory risk, and create sustainable digital relationships. Effective consent management is not just a legal obligation; it is a key part of managing personal data responsibly in the digital age.