Limited Applicability of Consumer Financial Protection Act’s “Time or Space” Exception with Respect to Digital Marketing Providers

Section 1002 of the Consumer Financial Protection Act of 2010 (CFPA) defines the term “service provider” and sets forth two exceptions to that definition. Under one of those exceptions, a person is not a service provider solely by virtue of such person offering or providing to a covered person time or space for an advertisement for a consumer financial product or service through print, newspaper, or electronic media. The Consumer Financial Protection Bureau (Bureau or CFPB) is issuing this interpretive rule to address digital marketing providers that commingle the targeting and delivery of advertisements to consumers, such as by using algorithmic models or other analytics, with the provision of advertising “time or space.” Digital marketing providers that are materially involved in the development of content strategy would not fall within the “time or space” exception as interpreted by the Bureau. Accordingly, digital marketing providers that are involved in the identification or selection of prospective customers or the selection or placement of content to affect consumer engagement, including purchase or adoption behavior, are typically service providers under the CFPA.