ICLE Scholars Available to Discuss Unintended Privacy Consequences as CPPA Finalizes ADMT Regulations
Portland, Ore. (Sept. 24, 2025) – Privacy regulators at the California Privacy Protection Agency (CPPA) gave final approval to new, stringent rules on how businesses use automated decision-making tools, set to go into effect in 2026. Scholars from the International Center for Law & Economics (ICLE) warn that the proposed regulations for Automated Decision-Making Technology (ADMT) are overly broad in scope, and definitions could stifle innovation, particularly for small and medium-sized businesses.
In its comments submitted to the CPPA in February 2025, ICLE scholars warned that the proposed regulations’ overly broad scope and definitions could stifle innovation, particularly for small and medium-sized businesses. The comments argued for a more targeted, incremental, and sector-specific approach that would focus on “truly consequential” uses of ADMT, rather than a sweeping framework that would capture routine, low-risk applications.
Kristian Stout, Director of Innovation Policy at ICLE, authored the February comments from ICLE and offered the following on CPPA’s final approval of the rules:
“While the CPPA was reasonable in its interest in looking at these rules in light of new technologies, the core framework remains rigid and risks placing California at a competitive disadvantage in AI leadership. The compliance burdens, particularly the phased cybersecurity audits and risk assessments, are a substantial cost for businesses of all sizes, and the impact on small businesses and the digital advertising ecosystem remains a valid concern. The CPPA’s rules further divide a fractured regulatory landscape, forcing businesses to navigate complex and potentially contradictory obligations.”
To schedule an interview with Kristian, contact Jim Fellinger at [email protected].
About ICLE
The International Center for Law & Economics is a nonprofit, nonpartisan research center working with a roster of more than one-hundred academic affiliates and research centers from around the globe. ICLE scholars promote the use of law and economics methodologies to inform public policy debates.