The General Data Protection Regulation (GDPR or the Regulation) became operative on May 25, 20181 and it is expected to have a profound effect on the management of personal data by data controllers and processors. Its far reaching provisions are expected to pose complex compliance challenges to organisations that process personal information worldwide including Nigerian businesses.
For an understanding of the GDPR, the definitions of certain words and phrases are of critical importance and some of these are below:
'Personal data is defined as ''any information relating to an identified or identifiable natural person.''2 Any identifiable natural person is someone who can be identified, directly or indirectly, in particular by reference to an identifier such as a name, an identification number, location data, an online identifier or to one or more factors specific to the physical, physiological, genetic, mental, economic, cultural or social identity of that natural person.3 Where different pieces of information can be added together and may lead to the identification of natural persons, that information may be considered personal information.4
'Processing means ''any operation or set of operations which is performed on personal data or on sets of personal data, whether or not by automated means, such as collection, recording, organization, structuring, storage, adaptation or alteration, retrieval, consultation, use, disclosure by transmission, dissemination or otherwise making available, alignment or combination, restriction, erasure or destruction.''5.
Controller means ''the natural or legal person, public authority, agency or other body which, alone or jointly with others, determines the purposes and means of the processing of personal data....''6 The data controller determines the purpose and means by which data is processed.
Processor means "a natural or legal person, public authority, agency or other body which processes personal data on behalf of the controller.''7 The data processor, usually a third party, processes personal data on behalf of and on the instructions of the data controller. This may be its main business activity.
Consent of the data subject means ''any freely given, specific, informed and unambiguous indication of the data subject's wishes by which he or she, by a statement or by a clear affirmative action, signifies agreement to the processing of personal data relating to him or her".8 Consent could therefore include ticking a box when visiting an internet website, choosing technical settings for information society services or another statement or conduct which clearly indicates in this context the data subject's acceptance of the proposed processing of his or her personal data. However, silence, pre-ticked boxes or inactivity would not be regarded as consent.9
Key Changes and Additional Provisions in the GDPR
Some of the key changes and additional provisions introduced by GDPR include –
Global application – The extra-territorial application of the Regulation is one of its most important provisions. Where a business not located in the E.U processes personal data in relation to (a) the offering of goods or services within the E.U, irrespective of whether or not a payment is required10, or (b) the monitoring of the behavior of individuals within the E.U,11 such a business will be required to comply with the provisions of the Regulation.12 It therefore appears that the Regulation is applicable to a Nigerian business where such a business processes personal data of E.U citizens or residents in relation to the offering or provision of good or services or monitors their behavior in any way shape or form.13 This is irrespective of the fact that such a business does not have an office or employees physically present in the E.U. It suffices to say therefore that if a Nigerian business targets E.U citizens or residents via the internet, markets in a language spoken in one or more E.U countries, agrees to accept a currency used in an E.U country for goods or services offered, offers to ship goods to E.U countries, appoints sales agents in E.U countries, represents that it has customers in the E.U, tracks persons resident in the EU or monitors their behavior in order to predict spending patterns or their behavior online e.t.c, such a business will be subject to the Regulation. It is important to note that it is not necessary for a financial transaction to have occurred before the business comes under the purview of the Regulation.
The Rights of the data subject14- The Regulation introduces new rights for data subjects. These rights include the right to request that personal information be deleted, erased or removed and no longer be processed (right to be forgotten);15 where the personal data is processed by automated means, the right to request for the data to be made available to the data subject or to a third party in a ''structured, commonly used, machine-readable and interoperable format'' (right to data portability)16 and the right not to be subject to a decision based solely on automatic processing which has legal effects or similarly significantly affect the data subject (right to object to profiling).17
Appointment of Data Protection Officers - Under certain conditions including where the core activity or business is the processing of data which requires regular and systematic monitoring of data subjects on a large scale or processing on a large scale of special categories of personal data or data relating to criminal convictions and offences, such an organization is required to engage a Data Protection Officer (DPO) who will be responsible for implementing, coordinating and monitoring their GDPR compliance obligations.18
Implementation of data protection by design and by default19 - In developing business policies and processes, businesses must proactively include data protection and privacy policies from the development stage and not as an afterthought.20
Data Breach Notification- Where there is a data breach the business is required to notify the appropriate authority without undue delay and not later than 72 hours after becoming aware of it, unless it can demonstrate that the breach is unlikely to result in a risk to the rights and freedoms of the data subject.21 Where the breach is likely to result in a risk to the rights and freedoms of the data subject, the data subject must also be notified without undue delay.22
Conduct of privacy impact assessment – Where a business is involved in systemic or extensive evaluation or large scale processing of personal data and the processing of the personal data is likely to result in a high risk to the rights and freedoms of natural persons, it will be required to conduct privacy impact assessment.23 The impact assessment is to evaluate, in particular, the origin, nature, particularity and severity of that risk. The result of the impact assessment will determine the appropriate measures to put in place for the data processing and compliance with the Regulation.
Consent – The consent of the data subject is critical to the processing of personal information, without which the processing could be unlawful.24 The consent must be ''freely given, specific, informed and unambiguous.'' It may be a statement or clear affirmative action and signifies agreement to the processing of personal data relating to the data subject.25 It could be written, oral or by electronic means. The consent may be withdrawn at any time.26 Where sensitive personal data or trans-border transfer of personal data is involved the consent must be explicit.27
Sanctions – The GDPR has introduced tougher sanctions for non-compliance. A regulatory authority can impose administrative fines up to a maximum four (4%) percent of the global turnover of a defaulting organization or up to 20m Euro per breach, whichever is higher.28 The applicable fine depends on the circumstances of each case and factors to be taken into consideration include but are not limited to the nature, gravity and duration of the infringement, whether the infringement was intentional or negligent, the actions taken to mitigate the damage to the data subjects, previous infringements, and the category of personal data involved.
Nigerian Businesses that may need to comply
Some of the Nigerian businesses that may need to comply with the regulations may include e-commerce companies, airlines, logistics, travel and hospitality companies, digital advertising companies, software companies, application developers, Nigerian companies employing E.U citizens, payment systems processing companies, telecommunication companies, internet services providers, cloud services providers, fintechs, recruitment agencies, hotels, law firms, and global mobility specialists
There is some uncertainty as to how the GDPR will be enforced against companies that even though are caught by its provisions are located outside the E.U and without any physical presence in the E.U. Enforcement can be directly against the representative of the business within the jurisdiction29, if any, though still without prejudice to any legal action that may be instituted against the business itself.30 The service or the website of the infringing company may be blocked. Where there is a sale and or delivery of physical goods, the goods may be seized on arrival in the E.U. Trade restrictions may be placed on the company's goods and services or the goods may be banned from being sold in the E.U. Where the company has assets within the E.U, the assets may be frozen or seized. In addition, the assets of the company in other jurisdictions that recognize judgments of the E.U might also be frozen or seized.
What do Nigerian businesses need to do?
Some of the steps Nigerian businesses that the GDPR may be applicable to need to take include -
- Implement data protection procedures.
- Review and amend contracts with suppliers and vendors that may be involved in activities involving the processing of personal data to ensure they are GDPR compliant.
- Train employees on GDPR compliance
- Ensure only necessary personal data is collected and stored and further review data storage procedures
- Ensure the deployment of appropriate technical and administrative processes to ensure adequate security for stored data.
- Where the business is involved in large scale data processing, appoint a Data Protection Officer
- Consent process must be clear, unambiguous and expressly provided by data subjects.
- Implement data breach detection and notification processes.
- Where a third party is engaged to process personal information contractually extract a guarantee that they will implement appropriate security measures that are GDPR compliant.
- In designing products ensure compliance with privacy by design and default requirements and be proactive.
- Adopt solutions such as data masking, encryption, and pseudonymization to protect customer data.
- Consider appropriate insurance coverage particularly where the business processes personal data on a large scale
Individuals will continue to make personal information available to public or private entities in order to purchase goods and access services. The challenge is how to ensure the safety and security of the provided personal information so that it is not abused or misused to the detriment of the data subject.
1. It replaced the Data Protection Directive 95/46/EC and repealed same immediately it came into effect. See Article 94 (1) of the Regulation.
2. Also referred to as the data subject. The Regulation does not apply to the processing of personal data of deceased persons or legal entities. See Recital 14 and 27
3. Article 4 (1) A person can even be identified from IP addresses, cookie strings, social media posts, online contacts and mobile device IDs and these are all regarded as personal data.
4. Article 9. further offers higher levels of protection to ''special categories of personal data'' and this includes data relating to religion, philosophical beliefs, health, racial or ethnic origin, political opinions, sex life or sexual orientation, trade-union memberships and so on.
5. Article 4 (2) Processing may include accessing database that contains personal information, staff management and payroll management, posting a person's picture on a website, sending promotional emails, storing IP addresses or MAC addresses, video recording, shredding documents containing personal data
6. Article 4 (7)
7. Article 4 (8)
8. Article 4 (11)
9. Recital 32
10. Recital 23 provides that in order to determine whether or not goods or services are being offered to data subjects who are in the E.U mere accessibility to the website making the offer in the E.U may be insufficient to ascertain such intention, factors such as the use of a language or a currency generally used in one or more E.U country or the mentioning of customers or users who are in the E.U may however be sufficient to make it apparent that the offer was targeted at data subjects in the E.U.
11. Recital 24 states that monitoring for this purpose would include tracking of the person on the internet and the potential subsequent use of personal data to profile the person to analyze or predict personal preferences, behavior or attitudes.
12. Articles 3 (2)
13. Recital 14 provides that the protections afforded by the Regulation in respect of the processing of personal data applies to all natural persons, whatever their nationality or place of residence.
14. Pursuant to the Regulation a data subject is an identified or identifiable natural person
15. Article 17 and this right can be exercised where, for example, the information is no longer necessary in relation to the initial purpose for which it was collected or the data subject withdraws his consent or the personal information was unlawfully processed. The right to be forgotten is however not an absolute right and can only be enforced under certain limited circumstances.
16. Article 20
17. Articles 22. Companies are required to have adequate processes in place to comply with these obligations and this may include the ability of the data subject to access and modify his/her information or contact details, or appointing a representative of the company that can assist with the enjoyment of these rights or to address data privacy concerns of customers.
18. Article 37.The DPO must be an expert in data protection law and practices and should perform its responsibilities in an independent manner
19. Article 25
20. In developing, designing, selecting and using applications, services and products that are used for processing personal data, producers of such products, services and applications are required to take into account the requirements for data protection and privacy when developing and designing such products, services and applications. Recital 78
21. Article 33
22. Article 34
23. Article 35
24. Unless there are other legitimate basis for the processing as may be provided either under the Regulation or by applicable laws.
25. Article 4 (11) This could include ticking a box when visiting an internet website, choosing technical settings for information society services or another statement or conduct which clearly indicates in this context the data subject's acceptance of the proposed processing of his or her personal data. Silence, pre-ticked boxes, failure to opt out or inactivity should not therefore constitute consent. See Recital 32
26. Article 7 (3)
27. Article 49 (1)(a)
28. Articles 83 (4) (5) and (6)
29. Appointed in line with Article 27
30. Article 27 (5)
Originally published July 2018
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.