United States: T Minus 1 Year Until GDPR: Are You Ready For Take Off?

The adoption of the European Union (EU) General Data Protection Regulation (GDPR) in April 2016 was one of the biggest changes in European privacy law in decades. It promises significant changes to the way organizations are expected to collect and use information. Further, the extra-territorial reach of the GDPR means organizations outside of the EU may be affected. With the threat of penalties of up to 4% of annual worldwide turnover or €20 million, organizations should take a serious look at their data collection and use practices to ensure compliance with the GDPR before it comes into effect on May 25, 2018.

Reaching Beyond The EU Borders
One of the most significant changes in the regulation is that the GDPR transcends the geographical borders of the EU. In particular, the GDPR applies to the processing of personal data of data subjects who are in the EU, including by organizations that are not established in the EU, provided the data processing is related to either:

  • the offering of goods and services to the EU data subjects (including both free and paid goods and services), or
  • the monitoring of their behavior in the EU (including tracking data subjects online for interest-based marketing).

In effect, any company that meets these criteria may be subject to the GDPR. The narrower "long arm" reach of the GDPR's predecessor, the EU Data Protection Directive 95/46/EC (the Directive), only applied to controllers that used processing equipment located in the EU and will no longer apply. Under the GDPR, many non-EU entities, including those that merely act as a processor at the instruction of, as agent for, or on behalf of a controller in the EU, are not beyond the reach of the GDPR.

Of particular note is the applicability of the GDPR to companies engaging in the "monitoring of the behavior of data subjects" – a concept which the Article 29 Working Party has confirmed includes all forms of tracking and profiling on the Internet, including for the purposes of behavioral advertising. Accordingly, all companies engaging in behavioral advertising or other tracking, and/or profiling activities, need to carefully consider the impact of the GDPR on their business.

Designating a Data Protection Officer
Another major change under the GDPR is the requirement that certain controllers and processors designate a data protection officer who has expert knowledge of data protection laws and practices and can help ensure their organization's compliance with the GDPR. The GDPR charges data protection officers with a number of obligations, including:

  • advising their colleagues,
  • monitoring his or her organization's compliance with applicable privacy laws (including by providing training, raising awareness and conducting audits),
  • advising on privacy impact assessments,
  • cooperating with supervisory authorities, and
  • responding to inquiries from data subjects.

The requirement to designate a data protection officer applies to organizations whose "core activities" (key operations necessary to achieve the controller's or processor's goals) involve "regular and systematic monitoring of data subjects on a large scale" (such as online tracking and profiling) or where the entity conducts "large-scale processing of special categories of personal data" (e.g., voluminous processing of personal data revealing racial or ethnic origin, political opinions, religious or philosophical beliefs).

Core Rules Remain, But New Details Hold Significant Impact
The GDPR preserves many of the core rules of the Directive, but updates and additions to these rules will have a significant impact on how entities process personal data. Under the GDPR, all processing must comply with all six general principles and satisfy at least one processing condition.

The six general principles are:

  1. Personal data should be processed in a lawful, fair and transparent manner.
  2. Personal data can only be processed in connection with specified and legitimate purposes.
  3. Personal data should be limited and relevant to the processing purpose.
  4. Personal data should be accurate and kept up-to-date.
  5. Personal data should only be retained for as long as it's needed and should be deleted after it fulfills its purpose.
  6. Personal data must be kept confidential and secure, and its integrity preserved.

Under the GDPR, some of the processing conditions have been enhanced and will be quite burdensome to satisfy. Consent is one example.

Valid consent under the GDPR requires that:

  • consent must be freely (i.e., no detriment if consent is refused or withdrawn) and affirmatively given (i.e., no pre-checked boxes) for each processing activity,
  • the request must be in plain language,
  • consent cannot be bundled with other requests,
  • consent is not conditional,
  • there is no power imbalance between the individual and the consent-seeker (i.e., such as an employer-employee relationship), and
  • the consent can be withdrawn at any time

Consent that has been obtained prior to the GDPR's effective date may be valid if all of the above requirements were met.

It's also important to note that while many of the Directive's definitions, including "personal data," remain the same under the GDPR, "sensitive personal data" has two new additions: genetic and biometric data. Information about criminal convictions and offenses is also carved out and treated separately with more restrictive controls.

Methods of Data Transfers
Under the GDPR, the core methods of data transfers also remain the same, such as standard contractual clauses, consent, binding corporate rules, transferring to a country that has privacy laws deemed adequate by the EU, and with respect to the United States, transferring the data to an entity registered with the EU-U.S. Privacy Shield Framework.

The GDPR adds two more methods. One method allows data transfers to inadequate jurisdictions if the importer has signed up to a GDPR approved code of conduct or certification scheme. The other new method is really an exemption that allows for one-time minor transfers that only affect a limited number of data subjects, where the risks have been assessed, safeguards applied and the supervisory authority and data subjects are informed of the minor transfer. The transfer can be done provided there is a compelling interest that is greater than the individual's privacy interest.

Increased Data Subject Rights
In addition to their existing rights under the Directive, data subjects under the GDPR will have additional rights, such as the right to be forgotten, the right to restrict processing, the right to object and the right to data portability.

The right to be forgotten (also known as the right to erasure) is an individual's right to have personal data erased or to prevent processing in specific circumstances. Note that children are given an enhanced right to erasure under the GDPR and there are extra requirements when the request for erasure relates to a child's personal data.

The right to restrict processing allows individuals to have a right to block or suppress processing of personal data under certain circumstances. If an entity receives a suppression or restriction request but personal data has already been disclosed to third parties, the entity has an obligation to inform the third party about the restriction on processing.

The right to object allows individuals to object to certain types of processing, including direct marketing, profiling and providing for purposes of scientific or historical research and statistics.

The right to data portability allows individuals to move, copy or transfer personal data from one place to another in a secure manner without interrupting the integrity and usability of the information.

Mandatory Breach Notification
Unlike the Directive, the GDPR provides a definition of "personal data breach" and requires that data controllers notify the relevant supervisory authority of a breach within 72 hours of discovery or provide reasoned justification for a delay. It also sets out the required content of the notification and exceptions to notification. Under the GDPR, entities may also have to report breaches to an individual in some cases.

Consequences of Noncompliance
Supervisory authorities under the GDPR have the power to impose fines on noncomplying entities. Sanctions can total up to the greater of €20 million or 4% of the entity's annual worldwide turnover. These fines apply to the noncompliance of most GDPR provisions, including failure to comply with the six general principles or inadequate consent for processing. There is a less onerous second tier of sanctions that apply to certain noncomplying activities that can result in sanctions of up to the greater of €10 million or 2% of the entity's annual worldwide turnover. Additionally, individuals also have a right to recover damages from a controller or processor in court.

Age Of Consent – 13 or 16
While the GDPR aims for more standardization among the Member States, there will still be differences in the way the GDPR is implemented and enforced in each Member State. Member States can modify certain details of the GDPR through derogations. For instance, they can lower the age of children's consent from 16 to 13, determine whether it is mandatory to appoint a data protection officer or introduce additional restrictions on the processing of employee data.

Action Items
Organizations should be actively preparing for the GDPR in the coming year to bring their businesses into compliance. Below are some action items organizations should consider after determining they fall under the purview of the GDPR:

  • Determine whether it's suitable to take steps to avoid being subject to the GDPR.
  • Confirm whether the organization's existing processes to obtain consent is in line with the new GDPR requirements.
  • Where applicable, appoint a data protection officer.
  • Re-approach existing users to obtain GDPR-compliant consent.
  • Put in place a mechanism to honor consent withdrawal requests.
  • Ensure requests from data subjects exercising their rights can be processed and fulfilled.
  • Update internal policies, external facing policies and vendor agreements.
  • Review and/or update existing contracts to ensure that any data processing, security and compliance obligations are appropriately addressed.
  • Review security and privacy programs in light of enhanced requirements.
  • Follow Member State laws that may apply as their requirements may vary from the obligations under the GDPR.
  • Ensure that your organization can demonstrate compliance with the GDPR. By way of example, consider taking the following steps:
    • Establish a comprehensive data protection and security program, including appropriate technical, physical, administrative and organizational measures that are consistent with the requirements of the GDPR.
    • Create and implement internal data protection policies (and any external facing policies, including online privacy notices) that are periodically reviewed, tested and updated.
    • Conduct regular internal audits of the organization's practices to ensure compliance with its policies.
    • Provide employees with regular, up-to-date training on data protection and security principles.
    • Require and document any necessary data protection impact assessments.

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.

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.

Similar Articles
Relevancy Powered by MondaqAI
Cooley LLP
Wilson Elser Moskowitz Edelman & Dicker LLP
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Cooley LLP
Wilson Elser Moskowitz Edelman & Dicker LLP
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

Mondaq.com (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 www.mondaq.com

To Use Mondaq.com 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