Canada: Tips From A Former Privacy Regulator

Last Updated: October 30 2014
Article by Chantal Bernier

As I transit out of my role leading the Office of the Privacy Commissioner of Canada (OPC) to join Dentons' privacy law practice, I decided to take stock of my experience as a regulator and draw some lessons. I am sharing them in the hope they can assist companies in responding to privacy regulators. 

At the OPC, I oversaw many, varied, privacy investigations. While focussing on the issues at hand, I couldn't help judge the strategy of the respondent companies. In some cases, I was impressed with their principled approach, their openness and their commitment to resolving the matter. At times, I recognized their cooperation publicly. In other cases, I would wonder why they would take an antagonistic stance on an issue as sensitive as privacy, an issue which their customers, in survey after survey, declare to hold so dear. I could see companies hurting their case by their strategy. While the OPC would provide them guidance in privacy law, it was not my place to tell them how to best make their representations.

Now I can. So here are five main tips that I believe can benefit companies in responding to a privacy regulator.

1. Establish a relationship as a matter of accountability

While I will not name the companies to respect confidentiality, I can tell you that I was always impressed when a new CEO, or a CEO simply taking the opportunity of a trip to Ottawa, or a company newly established or launching a new initiative that had privacy implications, would come and present themselves to the OPC. For me, it was not just a matter of public relations or developing personal contacts. It was about companies demonstrating accountability for privacy protection.

In some cases, the company's presentation served to inform the OPC of operational challenges in data protection. It allowed the OPC to make comments and voice expectations which then helped the company direct its privacy policies and practices. In other cases, the company and the OPC could exchange on legal interpretations without the pressure of an active investigation. In all cases, it showed me the company's commitment to understanding its privacy obligations and its sense of accountability to comply.

Some of the companies that were so forthcoming with the OPC eventually suffered serious breaches. My approach towards them took into account the high level of accountability the company had demonstrated in its relationship with the OPC. In applying compliance measures, I factored in the impact of the breach on individuals and the level of accountability for privacy protection demonstrated by the company, independently from the breach. That is the value of an established relationship in demonstrating accountability.

2. Treat breach response as an opportunity to demonstrate commitment to privacy

I often quote Robert Mueller, former Director of the FBI, who said that there are two kinds of companies: those that have been breached and those that will be. It is not a statement meant to get anyone off the hook on safeguard obligations. Rather, in my view, it is a call for organisations to implement safeguards commensurate to risk and for regulators to adopt a calibrated approach to compliance. That means taking into account the reality of risk and the quality of breach response.

To illustrate this point, I will name a company as I have already spoken publicly about it.

In June 2012, LinkedIn suffered a breach and notified the OPC and the public immediately. LinkedIn was one of those companies that had made a presentation to the OPC when it was starting to operate in Canada. Consequently, it was already known to the OPC for taking privacy protection seriously and for the type of safeguards it had in that regard.

Throughout breach response, in regular conferences calls, LinkedIn, with its legal counsel, kept the OPC and the three provincial regulators with private sector jurisdiction, apprised of every step it was taking to address the breach and the vulnerabilities that had been exploited. Throughout, LinkedIn showed its effectiveness and commitment in breach response. The breach response strategy had obviously been established long in advance of the breach, and LinkedIn spared no effort to implement it.

LinkedIn's impressive breach response was factored into the decision on compliance action: considering that the impact on individuals was limited and that LinkedIn's demonstrated accountability was high, it was decided to limit intervention to an exchange of letters with recommendations that LinkedIn accepted. 

Through breach response, LinkedIn showed its true commitment to privacy. 

3. Be transparent with the regulator to explain your operational challenges

In this case as well I will name a company to illustrate my point since our investigation was made public. In the investigation of Google online behavioural advertising, issued in January 2014, I was impressed and enlightened by Google's openness. Under strict confidentiality, Google described to the OPC its internal compliance framework to ensure implementation of its privacy policy by third party advertisers. This allowed me to better understand the operational challenges faced by Google, and the industry in general, in monitoring third party advertisers, as well as the appropriateness of the safeguards Google had in place.

The result was that the OPC was able to make recommendations to Google that were relevant, that Google was able to accept and that shed light on the systemic challenges of monitoring online behavioural advertising. I believe Google came out looking cooperative and committed to privacy. Perhaps more importantly, Canadians, business and regulators, were all seized of the broad privacy challenges inherent to a business model where free Internet rests on online advertising.

Confidentiality was respected and the fullness of Google's information helped their case as much as it helped clarify a new frontier of privacy law.

4. Think twice about fighting a principle with technicalities

By way of example, one argument that would sound the alarm bell for me about a respondent's commitment to privacy was a challenge on the basis of territorial jurisdiction. First, the OPC's territorial jurisdiction has been established by the courts to include foreign companies that have a substantial link to Canada. So it is broad. Second, international cooperation among Data Protection Authorities is tightening, which means that the OPC will likely reach out to the Authority where the company is based, in any event. Finally and most importantly, the right to privacy is of too great importance for allegations of its violation to be set aside by mere technicalities. Doing so downplays commitment to privacy.

I understand that for fear of reputational damage a company will use every argument to dispute a regulator's investigation. However, in relation to privacy, precisely for reasons of reputation protection, it may be worth showing an open mind, erring on the side of hearing out the substantive complaint as a sign of good will.

My advice where a company has questions about jurisdiction, or other technicalities (for example, an agreement with the complainant on another matter) is to set them aside as secondary, to focus on the privacy matter, first. This leads to my last tip.

5. Protect privacy as a matter of client service

At my first meeting with the Canadian Bankers Association, I asked "What does privacy mean to you?". Not surprisingly, the reply was "It is a matter of good client service". Indeed, the banks have the most established confidentiality rules. A bank's implied duty of confidentiality has long been recognized in our legal system. But banks have also embedded privacy in their mission to serve their clients. It may not be so obvious to other types of companies and yet protecting privacy should be and consumers expect it to be of central concern. Although statements abound that no one can possibly care about privacy considering all the personal information that is voluntarily shared on the Internet, surveys show that individuals will avoid a company that has suffered a breach or that is overly intrusive.

A regulator needs to see how a company takes on protection of privacy as a matter of client service. That will be demonstrated in the company's internal policies to protect privacy, which must be detailed and comprehensive, in its practices, which must be embedded and monitored, in its transparency, with readable privacy policies for customers to easily access, and in a sound governance framework to implement them, with a designated responsible officer, staff training and clear lines of accountability and recourse for data protection.

This is where the customer and the regulator stand on the same side. Privacy protection is good for business and demonstrating accountability for it earns the regulator's trust.

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