European Union: European General Data Protection Regulation Agreed – Headline Changes

Last Updated: 11 February 2016
Article by Rob Corbet, Colin Rooney and Olivia Mullooly

On 15 December 2015, the EU institutions agreed the new data protection framework to be implemented under the forthcoming Data Protection Regulation. The European Parliament and European Council are expected to adopt the final text of the Regulation in the next few months and it will then come into effect two years after its adoption (likely mid 2018).

The Regulation will replace the current European legislative framework under the 1995 Data Protection Directive ("Directive") on which the primary Irish data protection law, the Data Protection Acts 1988 and 2003 (the "Acts") is based. The current system of various national laws, that transposed the Directive, resulted in a fragmented regulatory system for data controllers operating in the European Union. As the Regulation will have direct effect, it should allow for the application and enforcement of a more standardised data protection law across the EU. The reforms will also specifically address some current technological challenges and opportunities in respect of the processing of personal data in the current digital age, including profiling, data portability and the 'right to be forgotten'. However, many of the core principles around data processing in the Regulation remain unchanged from the Directive, but have been expanded and clarified to strengthen the rights of data subjects.

The following are some of the principal changes that will arise under the Regulation:

EXTRA-TERRITORIALITY OF THE REGULATION

Presently, any company which is established in the EU or which has equipment which is used to process personal data located inside the EU is subject to the Directive (as transposed into local law in the relevant EU country). Similarly, these companies shall be subject to the Regulation once that legal instrument is passed into law and becomes operative.

However, certain companies which were not previously subject to the data protection laws of a European Member State will come under the remit of the Regulation. This is because the Regulation will also apply to all businesses who are established outside the EU but who offer goods or services to EU residents (whether or not for payment), or who monitor the behaviour of EU residents, regardless of whether the processing takes place in the EU or not.

SUPERVISORY AUTHORITIES

Currently, each Member State of the EU has a national Data Protection Authority ("DPA"), i.e. in Ireland this is the Irish Office of the Data Protection Commission ("DPC"), and the DPC oversees the enforcement of the Acts.

Under the Regulation, each Member State will establish a Supervisory Authority ("SA") and it is likely that most countries will transition their DPA to be the SA for that Member State. The SAs will fulfil a similar role to that discharged by DPA under the Directive. Functions of the SA will include investigation and enforcement of the Regulation and co-operation with other Member State SAs. Furthermore, a data subject may complain directly to an SA, which will investigate such complaints.

"ONE STOP SHOP"

An important change that the Regulation introduces for multi-jurisdictional businesses is the concept of the "one stop shop" compliance framework. This mechanism is relevant to companies who operate across many jurisdictions.

In practice, the one stop shop may simplify interactions with data protection regulators as data controllers/ companies will be subject to a "lead" SA (rather than having to interact with several different SAs simultaneously, as is presently the case). The competency of the lead SA will depend on which country is designated as the data controller's/company's "main establishment".

The lead SA will supervise the processing activities of the designated business throughout the EU and will consult and cooperate with the other national SAs (for example, in the context of international data transfers) in order to provide efficient and effective supervision of a business through one SA, rather than via multiple regulators.

CROSS-BORDER TRANSFERS OF PERSONAL DATA

From an Irish perspective and with reference to the Acts, the Regulation makes little practical impact on the requirements of businesses transferring data outside of the EEA.

Unlike the Directive, the Regulation will officially recognise Binding Corporate Rules ("BCRs") as a lawful method of data transfer for both data controllers and data processors within a group company structure or within "groups of enterprises engaged in a joint economic activity", where transfers to countries outside the EEA are envisaged. The Regulation will also simplify the process of adopting BCRs and provide a more streamlined approval process of BCRs on a cross-jurisdictional basis. The use of certifications and codes of conduct in the transfer of data are also addressed.

SEAL CERTIFICATIONS AND CODES OF CONDUCT

The Directive did not provide for the use of privacy seals or certifications which demonstrate to third parties that organisations are compliantly processing data. The Regulation recognises and encourages the use of privacy seals and certifications and adopts a framework for the use of such seals and certifications. The Regulation also allows for the submission of codes of conduct to the relevant SA for assessment in respect of compliance with the Regulation in this context.

INTERNAL RECORDS

Data controllers will be obliged under the Regulation to maintain internal records of data processing activities (which, in respect of content, will largely reflect the prescribed points already required to be addressed in a fair processing notice under Section 2D of the Acts as well as information on security measures and transfers to a third country). However, small and medium enterprises employing less than 250 persons need not keep such records, unless they process sensitive personal data or the processing they carry out is not occasional or likely to result in a risk for the rights and freedoms of data subjects.

DATA PROTECTION OFFICER

There will be an obligation on public authorities and bodies (save for courts acting in a judicial capacity) as well as data controllers and data processors whose core activities consist of processing operations "which require regular and systematic monitoring of data subjects on a large scale" or which consist of large scale processing of sensitive personal data to appoint a Data Protection Officer. This officer can be engaged as a consultant rather than as a full time employee.

REGISTRATION

The Regulation will abolish the requirement to register with data protection authorities.

NOTICE

There is a general principle in the Acts that certain information should be provided to data subjects detailing the processing of their personal data (i.e. an obligation to put the data subject on notice as to how their personal data is processed). The Regulation increases the amount of information to be included in such a notice.

One advantage to businesses of these notices is that a single notice should be sufficient for all Member States, albeit this notice will be much more detailed than was required under the Directive (as transposed). Interestingly the Regulation introduces a facility for the Commission to approve machine-readable standardised icons to assist data controllers in meeting their transparency obligations without having to rely on lengthy privacy notices.

DATA PROTECTION IMPACT ASSESSMENTS

Under the Regulation, businesses will be obliged to conduct Data Protection Impact Assessments ("DPIA") where the processing, particularly where it utilises any new technologies, "is likely to result in a high risk" for the rights of individuals, having regard to the "nature, scope, context and purposes of the processing".

The Regulation currently contains a non-exhaustive list of the situations in which a DPIA will be necessary, including where the data controller is monitoring publicly accessible areas or when sensitive personal data is being processed on a large scale.

The principles of data protection by design and by default are also enshrined in the Regulation, whereby user settings will automatically be privacy friendly and the development of services and products will take account of privacy considerations from the outset.

PROCESSING LEGITIMATELY

Pursuant to the Directive and the Acts, there are a number of grounds with which to legitimise the processing of personal data, including obtaining the consent of the data subject and these have been largely unchanged by the Regulation. However, the scope of certain grounds has been addressed in further detail.

For example, in order to demonstrate the data subject's consent, a business will not be allowed to rely on pro-forma terms and conditions to do so, unless the request for consent is presented in a manner which is "clearly distinguishable" from the other matters, "in an intelligible and easily accessible form, using clear and plain language". Consent to the processing of sensitive personal data remains subject to the requirement that consent be explicit.

Any processing pursuant to a legal obligation on the data controller is also the subject of some attention in the Regulation, setting out some parameters as to how Member State or Union law may prescribe such processing.

Article 6 also sets out some guidance for determining whether data may be processed for another purpose other than that for which the data was collected.

RIGHTS OF DATA SUBJECT

As a general comment, the rights of the data subject are strengthened and broadened under the Regulation.

The rights of the data subject under the Regulation largely reflect the principles in the Directive and the Acts with the exception of two additional rights which will be granted to data subjects under the Regulation:

  • the right to be forgotten (somewhat akin to the right arising from the Court of Justice of the European Union's ruling in Costeja v Google) whereby an individual may request the deletion of his or her data, provided that there are no legitimate grounds for retaining it; and
  • the right of data portability enabling individuals to transfer their data to other service providers.

BREACH NOTIFICATIONS

There is currently no legislative obligation in the Acts for a data controller to report a data breach to either the DPC or data subjects. The Regulation will introduce an obligation to report all breaches to the SA within 72 hours (unless the breach is unlikely to result in a risk to the data subjects) as well as all high risk breaches to data subjects.

Practically speaking, this obligation will require businesses to establish a data breach response procedure. This requirement under the Regulation should also prompt an analysis of information security measures to ensure a robust security system is in place and that, for example, encryption of personal data is employed, where reasonable and practical.

PROFILING PROHIBITION

In the event that a business uses tools which process personal data in order to evaluate, analyse or predict a data subject's performance at work, economic situation, location, health, personal preferences, reliability or behaviour i.e. profiling, this will become regulated under the Regulation and only permitted in certain narrow circumstances, such as consent or pursuant to a legal right. The Regulation encourages the use of anonymisation, pseudonymisation and encryption for further processing of data (e.g. in data analytics).

ENFORCEMENT AND PENALTIES

The Regulation prescribes a harmonised sanctions regime for the EU by setting ranges of fines for administrative sanctions. The largest fine under the Regulation is currently the greater of €20 million or 4% of the annual worldwide turnover of a business. Under the Regulation, data subjects are also granted a judicial remedy against an SA to act on his or her complaint. This will likely mean that the SA is obliged to investigate every complaint made by a data subject. The latter will make little difference in Ireland as the DPC currently investigates all complaints made to it by data subjects. Data subjects will also be granted a judicial remedy against processors and controllers in respect of any processing of their personal data which infringes the Regulation.

SAs are also granted enforcement powers under the Regulation (i.e. to enforce compliance with the requirements of the Regulation) which the DPC did not have under the Acts and these powers are likely to increase the frequency with which sanctions are levied.

The risk of substantial fines, increased enforcement powers of SAs and grounds for seeking judicial remedies in the Regulation will mean that businesses in general will need to consistently monitor compliance with data protection law with heightened vigilance following the commencement into law of the Regulation.

IMPLEMENTATION

It is likely that the Regulation will be adopted in Spring 2016, to take effect two years thereafter, e.g. in mid-2018. Despite the attempt of the Regulation to harmonise data protection law throughout the EU, post its inception, it is likely that there will be some areas in which the Member States will be required to apply national law, e.g. employment laws.

This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.

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

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

Authors
 
In association with
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
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
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). 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 & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd 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 or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.