Are there limitations on using sensitive customer data (e.g., health information) for custom audience creation?

Yes, there are significant limitations and regulations regarding the use of sensitive customer data, such as health information, for creating custom audiences. These restrictions are primarily due to data protection laws and platform policies designed to safeguard personal and sensitive information. Here's a comprehensive overview:

### **1. Regulatory Limitations**

**1.1. **General Data Protection Regulation (GDPR)**
   - **Sensitive Data Definition:** Under GDPR, sensitive data (also known as special categories of data) includes health data, racial or ethnic origin, political opinions, religious or philosophical beliefs, and sexual orientation.
   - **Processing Restrictions:** GDPR imposes strict conditions for processing sensitive data. Generally, you need explicit consent from individuals to process their sensitive data, and you must have a legitimate reason for doing so.
   - **Specific Provisions:** Article 9 of GDPR prohibits the processing of sensitive data unless specific conditions are met, such as obtaining explicit consent or fulfilling legal obligations. Processing such data for advertising purposes is generally not permitted under GDPR.

**1.2. **California Consumer Privacy Act (CCPA)**
   - **Sensitive Data:** While CCPA does not specifically categorize health data as sensitive in the same way as GDPR, it does require businesses to provide transparency regarding the collection and use of personal data.
   - **Opt-Out Rights:** CCPA gives consumers the right to opt out of the sale of their personal data, and businesses must provide mechanisms for users to exercise this right.

**1.3. **Health Insurance Portability and Accountability Act (HIPAA)**
   - **HIPAA Protections:** In the U.S., HIPAA protects health information and applies to covered entities like healthcare providers and health plans. If your organization is subject to HIPAA, using health information for advertising purposes is highly restricted and generally prohibited.

### **2. Platform Policies**

**2.1. **Facebook Advertising Policies**
   - **Prohibition on Sensitive Data:** Facebook's advertising policies prohibit the use of sensitive data, including health information, for custom audiences. You are not allowed to use or upload sensitive personal information to create audiences for targeting.
   - **Data Upload Restrictions:** When uploading customer data to Facebook for creating custom audiences, you must ensure that the data does not include sensitive information. Facebook requires that uploaded data be hashed (anonymized) and does not accept sensitive personal data.

**2.2. **Google Ads Policies**
   - **Sensitive Data Restrictions:** Similar to Facebook, Google Ads prohibits the use of sensitive data, including health information, for creating ad audiences. Google's policies mandate that advertisers avoid targeting or using sensitive categories of information.

**2.3. **Other Platforms**
   - **Compliance with Policies:** Most advertising platforms have similar restrictions and policies regarding the use of sensitive data. Always review and adhere to the specific data usage policies of each platform.

### **3. Best Practices for Handling Sensitive Data**

**3.1. **Avoid Use of Sensitive Data for Advertising**
   - **Data Minimization:** Do not collect or use sensitive data for custom audience creation. Focus on using non-sensitive, general data for targeting purposes.

**3.2. **Obtain Explicit Consent**
   - **Consent for Use:** If you must handle sensitive data, ensure that you have explicit consent from individuals for specific uses and comply with applicable data protection laws.

**3.3. **Implement Data Protection Measures**
   - **Data Security:** Employ strong data security measures to protect all personal data, including sensitive information, from unauthorized access or breaches.
   - **Anonymization:** Use anonymization techniques to safeguard sensitive data, though it should not be used for custom audience creation.

**3.4. **Train and Educate Staff**
   - **Data Handling Training:** Ensure that staff involved in data collection and management are trained on data protection regulations and the handling of sensitive data.

**3.5. **Regular Audits and Reviews**
   - **Compliance Checks:** Conduct regular audits to ensure compliance with data protection regulations and platform policies regarding sensitive data.

### **4. Examples of Prohibited Data**

**4.1. **Health Information**
   - **Medical Records:** Data from medical records or health diagnoses.
   - **Health Conditions:** Information about specific health conditions or treatments.

**4.2. **Other Sensitive Data**
   - **Race and Ethnicity:** Information related to racial or ethnic background.
   - **Political Opinions:** Data about individuals' political affiliations or opinions.
   - **Religious Beliefs:** Information about religious or philosophical beliefs.

### **Summary**

**Limitations on Using Sensitive Customer Data:**

1. **Regulatory Restrictions:**
   - GDPR and CCPA impose strict rules on processing sensitive data.
   - HIPAA restricts the use of health data for advertising purposes in the U.S.

2. **Platform Policies:**
   - Facebook, Google, and other platforms prohibit the use of sensitive data for custom audiences.

3. **Best Practices:**
   - Avoid using sensitive data for advertising.
   - Obtain explicit consent for any use of sensitive data.
   - Implement robust data protection measures and conduct regular compliance audits.

By adhering to these limitations and best practices, you can ensure that your use of customer data for custom audiences is compliant with regulations and respectful of user privacy.