A privacy policy is a statement or a legal document that discloses some or all of the ways a party gathers, uses, discloses, and manages a customer or client's data. It fulfills a legal requirement to protect a customer or client's can be anything that can be used to identify an individual, not limited to the person's name, address, date of birth, marital status, contact information, ID issue, financial records, credit information, medical history, where one travels, and intentions to acquire goods and services. In the case of a business it is often a statement that declares a party's policy on how it collects, stores, and releases personal information it collects. It informs the client what specific information is collected, and whether it is kept confidential, shared with partners, or sold to other firms or enterprises. Privacy policies typically represent a broader, more generalized treatment, as opposed to data use statements, which tend to be more detailed and specific.

The exact contents of a certain privacy policy will depend upon the applicable law and may need to address requirements across geographical boundaries and legal jurisdictions. Most countries have their own legislation and guidelines of who is covered, what information can be collected, and what it can be used for. In general, data protection laws in Europe cover the private sector as well as the public sector. Their privacy laws apply not only to government operations but also to private enterprises and commercial transactions.

California Business and Professions Code, Internet Privacy Requirements (CalOPPA) mandate that websites collecting (PII) from California residents must conspicuously post their privacy policy.