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By Patty P. Tehrani
Patty P. Tehrani, Esq., is an experienced compliance attorney and has nearly 20 years’ experience in compliance including senior in-house roles at top financial institutions, authoring articles and blogs, and compliance consulting engagements. She has created a series of tools, guides, and reference materials on governance, risk, and compliance functions—including guidance to help check for red flags and GDPR compliance weaknesses before they cause real problems—that can be found with the compliance-focused practical guidance on Bloomberg Law’s Corporate Practice Center.
It’s hard to believe that the May 25th compliance date of the European Union’s (EU) General Data Protection Regulation (GDPR) is right around the corner. That’s right—the GDPR will soon become a reality and is expected to significantly change the way organizations process personal data and respond to data breaches. This far-reaching regulation, adopted in 2016, will apply to organizations both in and outside of the EU and require them to institute new or enhanced data protection practices.
Given the severe consequences of non-compliance, complacency is not an option with the GDPR. There are the judicial remedies, complaints, investigations, orders, and fines stipulated under the regulation; and the fines can be very significant—up to €20 million or 4 percent of annual global turnover, whichever is higher. But being the organization at the center of a data breach failure may also result in reputational harm that can impact market and consumer confidence.
Your organization should be swayed by the severity of the GDPR’s fines and expansive changes to launch, if it hasn’t already, efforts to comply. Here are some recommendations for your organization to consider in planning its efforts as the GDPR compliance date approaches.
Your organization should approach GDPR with a defined plan that is practical and collaborative engaging participants from all key functions. Key steps to help plan your efforts:
With your plan in hand, your organization’s project team can determine the order and priority of the implementation measures in consideration of the GDPR’s key summarized below.
First, start with whether the GDPR applies to your organization. The GDPR’s Article 3 lays out the application of the regulation, which includes in its scope any organization that processes, holds or somehow controls or monitors the personal data of individuals in the EU, regardless of location or where the processing takes place. Consider the following questions to help make this determination:
If you can answer “No” to these questions, the GDPR most likely does not apply to your organization. However, if you answer “Yes” to any of these questions (even with qualifications), welcome to the world of the GDPR. But don’t end your inquiry here and make sure you consult your legal counsel, compliance, and privacy experts to confirm your assessment and the GDPR’s application to your organization. ( Note: Certain exceptions may apply, e.g., if your organization has fewer than 250 employees .)
It’s impossible to go through the GDPR in its entirety (99 Articles and lots of supporting recitals) here but let me highlight some key requirements.
Personal data (GDPR Article 4)—protect the processing of personal data, which the regulation defines as any information related to a natural person that can be used to directly or indirectly identify that person.
Lawful basis (GDPR Article 6)—have a valid lawful basis to process personal data.
Your organization should confirm the appropriate basis for processing:
Processor or Controller (GDPR Articles 4, 24,28)—determine the role your organization plays in processing personal data.
Accountability—document compliance with the GDPR’s six principles for processing of personal data:
1. Lawful, Fair and Transparent Processing
2. Purpose Limitation
3. Data Minimization
4. Data Accuracy
5. Storage Limitation
6. Integrity and Confidentiality
Awareness—raise awareness of the GDPR through periodic and specialized training and notices.
Records of processing activities (GDPR Article 30)—inventory your organization’s data processing activities.
Data Protection Officers (GDPR Articles 37–39)—appoint a Data Protection Officer (DPO) to oversee your organization’s implementation and maintenance of GDPR requirements.
Consent (GDPR Articles 7–8)—obtain valid consent for the processing of personal data.
Privacy Notices (GDPR Articles 12–14)—provide individuals with information about the collection and use of their personal data.
Rights (GDPR Articles 15–21)—provide individuals several rights relating to the processing and storage of their personal data; your organization should review its procedures and equip its systems/applications to be able to accommodate these rights:
Privacy by Design (GDPR Article 25)—integrate privacy risks from the onset of designing systems, rather than as an afterthought.
Security (GDPR Article 32)—equip systems with confidentiality, integrity, availability and resilience controls.
Data Breaches (GDPR Articles 33–34)—update your organization’s processes to manage data breaches to cover notice and timing requirements of the GDPR.
Data Protection Impact Assessment (GDPR Article 35)—document a risk-based assessment for high-risk processing.
Third Parties (GDPR Article 28)—screen your third parties, keep records, be clear who is doing what, have agreements, and monitor the agreements; review and update third-party engagements.
Transfers (GDPR Chapter 5)—ensure the appropriate movement of the data transferred outside of the EU.
The GDPR at first glance may appear daunting but read in a positive light may help your organization. First, it can help your organization confirm existing good practices in protecting personal data especially in this age of increasing frequency and sophistication of data breaches. Additionally, it may help from a marketing perspective when so many large organizations are facing consumer ire for failing to secure their data adequately. Greater transparency about data protection and more control over the processing of their personal data by consumers may not only advance these relationships but possibly result in new ones.
Finally, your goal should not be to meet all the regulation’s requirements by its compliance date but rather a measured approach and clear commitment to ongoing compliance with data protection requirements.
Copyright © 2018 The Bureau of National Affairs, Inc. All Rights Reserved.
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