ARTICLE
27 January 2012

Public Consultation On Proposed Changes To Personal Data Protection Act

The Ministry of Security and Justice is currently conducting a public consultation on a draft bill to amend the Dutch Personal Data Protection Act.
Netherlands Privacy
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The Ministry of Security and Justice is currently conducting a public consultation on a draft bill to amend the Dutch Personal Data Protection Act.

The draft bill aims to extend the scope for using images from individuals' and businesses' surveillance cameras for the investigation of criminal offences. It also proposes the introduction of a notification requirement regarding data leaks.

Individuals and businesses can participate in the consultation at http://www.internetconsultatie.nl/camerabeelden

The consultation period for the draft bill to amend the Personal Data Protection Act will run until 29 February 2012. The two most important changes are described below.

1. Use of surveillance camera images for investigating criminal offences

Under the proposed new rules, camera images of criminal offences recorded by businesses or private individuals may be published (e.g. on the internet or on screens in shopping centres) either if there has been a prior investigation by the Dutch Data Protection Authority (College Bescherming Persoonsgegevens, "CBP") or if suitable and specific guarantees are in place. These guarantees are to be elaborated on in a general administrative order, and will be based on those applicable under the rules on communications to the public in connection with criminal investigations (as laid down in the Aanwijzing Opsporingsberichtgeving).

2. Notification requirement regarding data leaks

Businesses and government bodies will be required to report breaches of security measures for the protection of personal data if they become aware of such a breach. The incident must be notified to the CBP and to the relevant data subject(s) if there is a significant risk that the leaked data have been or will be lost or unlawfully processed. Administrative fines may be imposed in the event of non-compliance.

More specifically, the rules provide as follows:

  • The CBP must immediately be notified of a breach of security measures if it can reasonably be assumed that, as a result of that breach, there is a significant risk that the leaked data have been or will be lost or unlawfully processed, adversely affecting the personal data and privacy of the data subject(s).

The explanatory memorandum to the draft bill states that it must be determined as objectively as possible, based on an assessment of the facts and circumstances of the case at hand, that a significant risk as described above reasonably exists. The memorandum also states that it is expected that the CBP will draw up policy rules on fines and that these will indirectly provide a degree of practical guidance.

Following receipt of the notification, the CBP will assess whether it is necessary to conduct an investigation or to issue instructions. It may also choose not to respond to the notification.
  • The relevant data subject(s) must also immediately be notified of the breach.
  • The CBP as well as the data subject(s) must in any event be notified of the nature of the breach, the bodies or organisations from which more information about the breach can be obtained and the recommended measures for limiting the negative consequences of the breach.
  • The notification to the CBP must also include a description of the identified and the probable consequences of the breach on the processing of personal data, in addition to the measures the responsible party has taken or proposes to take in order to remedy these consequences.
  • The notification to the data subject(s) must be such as to ensure that the provision of information is carried out in a proper and careful manner, taking into account the nature of the breach, the identified and the actual consequences of the breach on the processing of personal data, the circle of data subjects affected and the costs.

The explanatory memorandum states, for example, that in cases where the breach affects a relatively limited number of data subjects, these can be approached personally and in a tailored manner. If, however, a larger number of data subjects is affected, a newspaper advertisement in addition to a website announcement would be considered more appropriate.
  • Notification to the data subject(s) is not required if, in the CBP's opinion, the responsible party has taken appropriate technological protection measures to ensure that the personal data in question are encrypted or otherwise rendered unintelligible to parties that are not entitled to access those data.
  • If the responsible party does not notify the data subject(s) of the breach, the CBP may – if it decides that the breach is likely to adversely affect the personal data and privacy of the data subject(s) – demand that the latter be notified.
  • Records must be kept of all breaches.
  • Further rules on the notification may be laid down in general administrative orders.
  • The CBP may impose a maximum fine of EUR 200,000 in the event of failure to comply with the abovementioned obligations.

The above also affects contracts with data processors (i.e. external parties that process personal data for and on behalf of the responsible party).

The notification requirement pursuant to the Personal Data Protection Act will not apply:

  • if the responsible party is a provider of electronic communications services and, in that capacity, has made a notification as referred to in Article 11.3a(1) and (2) of the Dutch Telecommunications Act. Under the new rules, such notifications will have to be made to the CBP instead of OPTA (the Independent Post and Telecommunications Authority);
  • if the responsible party has an obligation, pursuant to Article 3:10(3) or Article 4:11(4) of the Financial Supervision Act, to provide information to the Dutch Central Bank or the Netherlands Authority for the Financial Markets. These provisions require financial institutions to inform the relevant body about incidents relating to the soundness of their business operations (integere bedrijfsvoering).

The explanatory memorandum explains that financial institutions are required to keep internal records of such incidents (pursuant to Article 12 of the Prudential Rules (Financial Supervision Act) Decree and Article 19 of the Financial Institutions Business Conduct Supervision Decree). Furthermore, in the event of an incident having consequences for one or more clients, the financial institution must inform the relevant client(s) about that incident. According to the explanatory memorandum, these rules sufficiently safeguard the interests of data subjects with regard to the protection of their personal data. This is because the principles of the Financial Supervision Act in this regard are largely in line with those of the draft bill: they too are directed at the preservation and, where necessary, the restoration of data subjects' trust in the responsible parties. Consequently, there is no reason to impose a double notification requirement on the financial sector, which is why the draft bill contains an exception for financial institutions that are already subject to a notification requirement pursuant to the Financial Supervision Act.

According to the explanatory memorandum there is, however, a material difference between the notification requirements pursuant to the draft bill and those pursuant to the Financial Supervision Act. The duty of confidentiality under Articles 1:89 and 1:90 of the Financial Supervision Act does not allow for notifications to data subjects regarding data leaks to be made in the manner set out under the draft bill, because the latter provides for public notifications. In the financial sector, it would be too risky (partly in view of the financial crisis) to make public notifications of this type mandatory, as it cannot be predicted whether such a notification might not lead to rumours that are incapable of being objectively dispelled, causing an unnecessary decrease of trust on the part of the public or the relevant market. However, since practice has shown that financial institutions carry out their responsibility towards their clients by contacting them directly, this ensures that the difference between the two notification requirements will not have adverse consequences for the relevant data subject(s).

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.

ARTICLE
27 January 2012

Public Consultation On Proposed Changes To Personal Data Protection Act

Netherlands Privacy

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