May 25, 2018. If you are a company that comes into contact with
European data, whether you are operating in Europe or elsewhere,
and you have not taken note of this date yet, you should. That is
when Europe's new data protection framework – the General
Data Protection Regulation (GDPR) – will enter into force,
replacing Data Protection Directive 95/46/EC (the
"Directive"). Building on the premise that the protection
of personal data is a fundamental right, the GDPR seeks to protect
the personal data of individuals in the EU and ensure the free flow
of personal data between Member States of the European Union (EU)
and in Iceland, Liechtenstein and Norway, which are part of the
European Economic Area (EEA).
Whereas the Directive required EU Member States to implement its
key principles regarding the protection of personal data through
national data protection laws, the GDPR applies directly to all
Member States without the need for national legislation. The
GDPR's harmonization of data privacy laws still embraces the
key principles of the previous Directive, but it also introduces
many significant changes. Here are just a few:
Geography Does Not Matter
Perhaps the most significant change from the previous Directive
is the GDPR's global reach. Even if your company does not have
operations in Europe, the GDPR still applies if your organization
processes personal data of individuals in the EU and such
processing is related to either (i) the offering of goods or
services (no payment is required), or (ii) the monitoring of their
behavior. The new rules were clearly intended to include internet
activity, and it means that online platforms and other website
operators that are accessible from Europe and have any sort of
tracking mechanism (i.e., cookies) will be subject to the GDPR.
Accountability and Privacy By Design are Now Mandated
Privacy by design is an approach to designing projects,
processes, products or systems that promote privacy and data
protection from the start. This approach was not a requirement of
the previous Directive but it has been embraced by the GDPR, which
requires data controllers to hold and process only the data
absolutely necessary for the completion of its duties (data
More Stringent Consent Requirements
The conditions for processing data based on consent have been
updated under the GDPR. First, written consent must be presented in
a manner that is clearly distinguishable from other matters. For
example, the terms and conditions of sale for an online purchase
should be presented separately from the consent to share personal
data with third parties for marketing purposes. Additionally, the
consent must be intelligible and use clear, plain language (no
legalese). Finally, it must be as easy to give consent as it
is to withdraw it.
The GDPR uses a tiered approach to fines, with fines of up to 4%
of annual global revenues or €20 Million (whichever
is greater) for the more serious violations (for example, not
having sufficient consent to process data). Other infringements
such as failing to notify the supervisory authority and data
subjects of a breach can attract fines of up to 2% of annual global
revenues or €10 Million. The significant
increase in fines under the GDPR should get the attention of board
level executives, making compliance a top priority for 2017.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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