It is indeed quite complex. I would argue that just the login does not need.
1. There are users who will come to your website with specific purpose or expectation of your service.
2. Then there are users who came to website by accident and might just try out things without understanding what is happening.
The banner recommendation from the lawyers is likely for the 2nd case. The users haven't subscribed to the service with certain expectation or knowledge what is expected from them to service to provide what they want. Or they have zero expectations about the service to provide something for their needs.
For example, the login case, the group 1. probably wants to stay logged in if they came to service with expectation of personal service, which cannot be linked to the person without an account.
Or the lawyers just did not understand your service well enough and just said that put the banner be done with it.
For group 2. it is unlikely that someone did not expect or want to stay logged in all the time, but that is for minority and arguable case whether is fair to assume that.
1. There are users who will come to your website with specific purpose or expectation of your service.
2. Then there are users who came to website by accident and might just try out things without understanding what is happening.
The banner recommendation from the lawyers is likely for the 2nd case. The users haven't subscribed to the service with certain expectation or knowledge what is expected from them to service to provide what they want. Or they have zero expectations about the service to provide something for their needs.
For example, the login case, the group 1. probably wants to stay logged in if they came to service with expectation of personal service, which cannot be linked to the person without an account.
Or the lawyers just did not understand your service well enough and just said that put the banner be done with it. For group 2. it is unlikely that someone did not expect or want to stay logged in all the time, but that is for minority and arguable case whether is fair to assume that.