Is the new Brazilian data protection law a cut-and-paste of the European GDPR?
There is no doubt that the EU's General Data Protection Regulation (GDPR) has caused a great deal of discussion about privacy around the world. It has clearly inspired the creation of several other national and regional legislations, including the Brazilian Data Protection Regulation (LGPD).
Is the LGPD a copy of the GDPR?
The LGPD enters into force in August 2020 and it resembles the GDPR in many but by no means all respects; there are a number of differences. The Brazilian law is much more concise than the GDPR.
One of the reasons for the development of the LGPD was to make data treatment in Brazil compliant with European standards. The Brazilian law contains a similar extraterritoriality principle as the one in the GDPR: it applies to personal data collected from individuals located in Brazil, to any data processing carried out in Brazil, and to the offering of goods and services to individuals located in Brazil.
Like the GDPR, the LGPD ensures a number of rights for data subjects, defines several lawful bases for data processing, introduces enhanced requirements for the processing of sensitive personal data and rules on the international transfer of data. It does give some direction to companies willing to offer goods and services to customers located in Brazil. The concepts of privacy by design and privacy by default are enshrined by law and Data Protection Impact Assessments by controllers are required under certain circumstances.
Although similar in scope and applicability, the differences between the LGPD and GDPR start with the definition of "personal data" and "sensitive personal data". In the LGPD the concept of 'personal data' is broader than the one in the GDPR. Although both define personal data as "information relating to an identified or identifiable natural person", the Brazilian law establishes no criteria for an individual to be considered identifiable, while the GDPR clearly gives examples in Article 4(1).
As regards the definition of sensitive data, the GDPR and the LGPD have similar definitions "data concerning health, biometric data, genetic data", etc. Nevertheless, the GDPR, once again, specifies each of those categories, while the LGPD only mentions them generically.
The LGPD has no equivalent to the GDPR's representative role, stating merely that foreign companies shall be notified of, and summoned in relation to, all procedural acts established in the LGPD by means of its agent or representative, or person in charge of its branch, agency, subsidiary, among others, established in Brazil.
Another major difference between the two laws relates to the processing of personal data for direct marketing purposes, as the GDPR defines the specific requirements and steps to be taken in those cases, while the Brazilian law is silent on the subject.
While the GDPR gives data subjects the right to object, at any time, to the processing of their personal data for profiling and marketing purposes the LGPD does not specifically address direct marketing and this suggests implied authorisation, as long as the treatment follows the general rules applicable to consent, transparency and rights of data subjects to oppose to the data processing.
Originally, an entire section determining the creation of a supervisory authority – the Data Protection Authority (ANPD) was vetoed by the former President Michel Temer, who then issued a Provisional Measure creating the ANPD in the final week of 2018.
A number of topics relating to the ANPD are still being discussed, as regards constitutional principles, scope and reach and budgeting and financial adequacy. In the European context, the GDPR provides for the creation of the European Data Protection Board to ensure the correct application the GDPR.
The GDPR provides great detail regarding Data Protection Impact Assessments (DPIAs) to help assess whether processing will result in high risks to the rights and freedom of natural persons. Even though the LGPD also requires controllers to carry out DPIAs, it does not clarify when they should be used.
Furthermore, the GDPR requires controllers to consult the supervisory authority prior to data processing, whenever a DPIA indicates that processing would result in high-risk operations, while the Brazilian law has not brought in an equivalent requirement.
The Brazilian Regulation has no detailed timeframes (beyond being within a reasonable time) for notification of data breaches, whereas the GDPR determines that data breach incidents must be notified to authorities within 72 hours.
The Brazilian Regulation and the GDPR take very similar approaches to third party transfers in as much as they may take place where the ANPD recognises that the third country ensures an adequate level of data protection. However, while the GDPR clearly establishes the procedures and elements to be considered by the Commission when making a data adequacy assessment, the Brazilian legislation is vague in relation to this.
Finally, the penalties adopted by each Regulation take the same approach: while the GDPR determines that, in case of a data breach incident, there may be fines of EUR 10 to 20 million or 2-4% of the total worldwide annual turnover of the preceding financial year, whichever is higher, the Brazilian Regulation establishes simple fines of up to 2% of the sales revenue of the company, group or conglomerate in Brazil, and fines of up to fifty million Reais per violation.
Challenges for controllers and processors under the LGPD
Controllers and processors of personal data in Brazil face a number of challenges. There is a general unawareness of the importance of the protection of privacy and data subjects' rights.
The country only began discussing comprehensive data protection legislation in 2009. This is very different from Europe, where the first data protection laws were made decades ago. Since the LGPD is a fairly recent Regulation, controllers and processors lack appropriate technology systems, data governance mechanisms, and ways to allow data subjects to exercise their rights.
There are also general difficulties in obtaining consent, identifying the legal bases for data treatments, ways to ensure employees and stakeholders are properly involved with data flows and comply with the rules and, more importantly, infrastructure problems caused by the delay in setting up the regulatory mechanism.
Consequently, there is still a general lack of clear rules on data protection. Controllers and processors are very much relying on the European model to set up mechanisms for players in Brazil to become compliant with the LGPD.
This means that while the Brazilian Regulation resembles the GDPR, there are also significant differences; the LGPD is simply not as evolved as the GDPR. As a result, ensuring compliance with the LGPD will present a major challenge to businesses and individuals who process personal data.
There is a pressing need for appropriate guidance and communication with consumers, data protection authorities and employees, and businesses will have to keep finding creative ways to enhance technology, and foster free competition, without prejudicing data subjects' rights.
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.