Australia: The end of a long road: Mandatory data breach notification becomes law

Personal information is in essence any information that allows an individual to be personally identified.

The Privacy Act 1988 (Cth) ('Privacy Act') regulates the handling of this 'personal information' by all Commonwealth public sector agencies; as well as private sector organisations that have an annual turnover of more than $3 million, are health service providers or which otherwise trade in personal information (together, 'Organisations'). The recent introduction of a mandatory data breach notification regime in Australia has been on the horizon for a number of years.

The road to mandatory data breach notification

In May 2013, the Commonwealth Labor government introduced the Privacy Amendment (Privacy Alerts) Bill 2013 ('2013 Bill') to amend the Privacy Act to introduce a mandatory data breach notification regime. Despite the 2013 Bill having bipartisan support, it was not passed before the 2013 federal election and lapsed as a result.

There were then various subsequent attempts to revive the push to amend the Privacy Act and in February 2015, as part of a report into the Telecommunications (Interception and Access) Amendment (Data Retention) Bill 2014, the Parliamentary Joint Committee on Intelligence and Security ('PJCIS') recommended the introduction of a new mandatory data breach notification scheme. In March 2015, the government indicated that it would support all of the recommendations made by the PJCIS. In December 2015, the Attorney-General's Department released an exposure draft of the Privacy Amendment (Notification of Serious Data Breaches) Bill 2015 ('Exposure Draft') for public comment. It received approximately 45 submissions from industry and consumer groups, regulators, government departments, law reform bodies and major Australian and international companies. Many of the submissions raised similar issues, including concerns about the scope or lack of definition of key terms such as 'real risk' and 'serious harm' and the possibility that multiple breach notices may be required in respect of a single incident.

The Privacy Amendment (Notifiable Data Breaches) Bill 2016 (Cth) (Bill) was subsequently introduced into the Senate on 19 October 2016. The Bill differs from the Exposure Draft in a number of ways, including some changes to address many of the issues raised in the submissions on the Exposure Draft. The Bill was passed in February this year but will not take effect until 22 February 2018, unless an earlier commencement date is proclaimed.

Mandatory data breach notification obligations under the Bill

The Bill amends the Privacy Act to introduce a new legislative requirement that the Privacy Commissioner and any affected individuals be notified when an 'eligible data breach' has occurred. Agencies and Organisations will be required to:

  • conduct an assessment of whether an eligible data breach has occurred within 30 days of becoming aware that there are reasonable grounds to suspect that there may have been such a breach (s 26WH)*; and
  • if an agency or Organisation is aware that there are reasonable grounds to believe that there has been an eligible data breach (s 26WK(2)), they must prepare a statement that contains the identity and contact details of the agency or Organisation, a description of the eligible data breach, the kinds of information affected and recommendations for affected individuals (s 26WK(3)). The statement must then be provided to the Privacy Commissioner (s 26WK(2)(a)(ii)), and each of the individuals to whom the affected information relates or who is at risk from the eligible data breach must be notified. If it is not practicable to directly notify the affected individuals, then the agency or Organisation must publish the statement on its website.

An eligible data breach occurs where:

  • there is unauthorised access to, or unauthorised disclosure of, personal information held by the agency or organisation, or personal information is lost in circumstances where access to, or unauthorised disclosure of, the information is likely to occur; and
  • a reasonable person would conclude that the access or disclosure would be likely to result in serious harm to any of the individuals to whom the information relates (s 26WE(2)).

In assessing whether the access or disclosure would be likely to result in serious harm, the agency or Organisation is required to have regard to a number of factors, including:

  • the kinds of information affected and its sensitivity;
  • whether a security measure (such as encryption) was applied in relation to that data;
  • the likelihood that the security measure could be defeated (including whether the persons who are likely to receive that data have the ability to circumvent the security measure, such as by obtaining or 'cracking' the encryption key);
  • the nature of the potential harm to affected individuals; and
  • any other relevant matters (s 26WG).

However, in cases where remedial action has been taken (such as when an individual who receives a misdirected email or letter agrees to destroy that communication without reading it) and a reasonable person would conclude that the remedial action would mean that the access, disclosure or loss of the information would not be likely to result in serious harm to any affected individuals as a result, then the notification obligations would not apply (s 26WF).

New powers of the Privacy Commissioner

If the Privacy Commissioner is aware that there are reasonable grounds to believe that an eligible data breach has occurred (s 26WR(1)), then it will have the power under the new amendments to require the affected agency or Organisation to make a data breach notification.

The Privacy Commissioner also has the power to declare that an agency or Organisation does not have to comply with these notification obligations and can also extend the time for compliance with the notification obligations (s 26WQ). The Commissioner may make such a declaration on his or her own initiative. The affected agency or Organisation can also apply to the Privacy Commissioner for such a declaration.

The Commissioner must consider the public interest and any relevant advice given by law enforcement or security agencies.

Data held by offshore service providers

The new mandatory data breach notification obligations may also apply where the data which is the subject of the data breach is held by a service provider outside Australia. Australian Privacy Principle 8.1 under the Privacy Act allows personal information to be disclosed outside Australia if the Australian agency or Organisation has taken reasonable steps to ensure the offshore recipient handles that information in accordance with the Privacy Act, such as by entering into a binding contract with the offshore recipient that imposes equivalent privacy obligations on the offshore recipient.

Where an Organisation or agency in Australia has disclosed personal information to an offshore recipient under Australian Privacy Principle 8.1, an eligible data breach that occurs offshore in relation to that transferred personal information is deemed to be an eligible data breach that affects the Organisation or agency in Australia (s 26WC(1)). This provision would potentially apply to Australian agencies or Organisations that hold personal information in cloud computing platforms that are located outside Australia.

Penalty for failure to report a breach

A failure to report an eligible data breach (either when required by the relevant provision of the Privacy Act as amended, or when the agency or Organisation is directed to make a notification by the Privacy Commissioner) will be deemed to be an interference with the privacy of the individuals affected by the eligible data breach (s 13(4A)). This means that a failure to notify affected individuals of an eligible data breach could be the subject of a complaint to the Privacy Commissioner (Privacy Act, s 36).

Where the failure to make a notification of the eligible data breach amounts to a serious or repeated interference with privacy, the Privacy Commissioner has the power to seek civil penalty orders of up to $360,000 in the case of individuals and up to $1.8 million in the case of bodies corporate (ss 80W & 80X).

Possible consequences of the new regime

Privacy compliance and cyber security are likely to become even more critical risk issues for company boards and senior government officials between now and when the Bill comes into effect on 22 February 2018.

Prospect of class actions and representative complaints

There is a very real prospect of class actions being initiated following the occurrence of any notified data breach. This has been the case in the United States following the introduction of data breach notification obligations in most states, where a notification of the occurrence of a data breach is often quickly followed by a class action being filed on behalf of the affected individuals. It is certainly possible Australia will follow down this path with the introduction of mandatory data breach notification laws.

The Privacy Act does contain a representative complaint mechanism that allows an individual to make a representative complaint to the Privacy Commissioner, so it is possible that the new data breach notification obligations could lead to an increase in the number of representative complaints. A representative complaint can be made on behalf of all affected individuals if the class members have complaints against the same entity, the complaints arise out of the same or similar circumstances and the complaints all give rise to a common issue of law or fact. It is not necessary to specify the number of class members or to obtain the consent of the class members before the representative complaint is lodged.

Given that the affected Organisation or agency would have had to identify the affected individuals as part of notifying them of the occurrence of the data breach, formulating a representative complaint or identifying a class of plaintiffs for a class action by reference to the individuals who receive a data breach notification may be a relatively straight forward exercise.

Increased demand for cyber risk insurance

The introduction of mandatory data breach notification obligations may also lead to an increased demand for cyber risk insurance, which is a relatively new type of insurance policy in the Australian market. Depending on the policy, cyber risk insurance may cover 'first party' loss or costs for the agency or Organisation (such as legal expenses, forensic IT experts' costs and any fines or penalties) as well as third party losses and claims.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Thynne & Macartney
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Thynne & Macartney
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions