General Data Protection Regulation

The European Commission plans to unify data protection within the European Union (EU) with a single law, the General Data Protection Regulation (GDPR). The current EU Data Protection Directive 95/46/EC does not consider important aspects like globalization and technological developments like social networks and cloud computing sufficiently and determined that new guidelines for data protection and privacy were required. Therefore a proposal for a regulation was released on 25 January 2012. Subsequently numerous amendments have been proposed in the European Parliament and the Council of Ministers. The EU's European Council aims for adoption in late 2014 and the regulation is planned to take effect after a transition period of two years.

Summary

"The proposed new EU data protection regime extends the scope of the EU data protection law to all foreign companies processing data of EU residents. It provides for a harmonization of the data protection regulations throughout the EU, thereby making it easier for non-European companies to comply with these regulations; however, this comes at the cost of a strict data protection compliance regime with severe penalties of up to 2% of worldwide turnover." Note: The current version contains increased fines up to 5%.

Content

The proposal for the European Data Protection Regulation contains the following key changes:

Scope

The regulation applies if the data controller or processor (organization) or the data subject (person) is based in the EU. Furthermore (and unlike the current Directive) the Regulation also applies to organizations based outside the European Union if they process personal data of EU residents. According to the European Commission "personal data is any information relating to an individual, whether it relates to his or her private, professional or public life. It can be anything from a name, a photo, an email address, bank details, posts on social networking websites, medical information, or a computer’s IP address."

Single set of rules

A single set of rules applies to all EU member states and there will be one Single Data Protection Authority (DPA) responsible for each company depending on where the Company is based or which DPA it chooses (THIS STILL HAS TO BE DECIDED AND APPARENTLY THIS SOLUTION WILL BE ABANDONED). A European Data Protection Board will coordinate the DPA's.

There is an exception for employee data that still might be subject to individual country regulations.

Responsibility & accountability

The notice requirements remain and are expanded. They must include the retention time for personal data and contact information for data controller and data protection officer has to be provided.

Privacy by Design and by Default (Article 23) require that data protection is designed into the development of business processes for products and services.

Privacy settings are set at a high level by default.

Data Protection Impact Assessments (Article 33) have to be conducted when specific risks occur to the rights and freedoms of data subjects. Risk assessment and mitigation is required and a prior approval of the DPA for high risks. Data Protection Officers (Articles 35-37) are to ensure compliance within organizations. They have to be appointed for all public authorities and for companies processing more than 5000 data subjects within 12 months.

Consent

Valid consent must be explicit for data collected and purposes data used (Article 7; defined in Article 4). Consent for children under 13 must be given by child’s parent or custodian, and should be verifiable (Article 8). Data controllers must be able to prove "consent" (opt-in) and consent may be withdrawn.

Data breaches

The data controller has to notify the DPA without undue delay and, where feasible, not later than 72 hours after having become aware of the data breach (Article 31). Individuals have to be notified if adverse impact is determined (Article 32).

Sanctions

The following sanctions can be imposed:

• a warning in writing in cases of first and non-intentional non-compliance
• regular periodic data protection audits
• a fine up to 1 000 000 EUR or up to 2% of the annual worldwide turnover in case of an enterprise, whichever is greater (Article 79, Number 6)

Right to erasure

A so-called right to be forgotten was replaced by a more limited right to erasure in the version of the GDPR adopted by the European Parliament in March 2014. Article 17 provides that the data subject has the right to request erasure of personal data related to him on any one of a number of grounds including non-compliance with article 6.1 (lawfulness) that includes a case (f) where the legitimate interests of the controller is overridden by the interests or fundamental rights and freedoms of the data subject which require protection of personal data (see also Google Spain SL, Google Inc. v Agencia Española de Protección de Datos, Mario Costeja González).

Data portability

A user shall be able to request a copy of personal data being processed in a format usable by this person and be able to transmit it electronically to another processing system. (Article 15)

Timeline

The preliminary schedule is

• 21 October 2013: European Parliament Committee on Civil Liberties, Justice and Home Affairs (LIBE) had its orientation vote.
• Ongoing negotiations between European Parliament, Council and Commission (Trilogue)
• Expected adoption in 2015
• Expected enforcement from 2017

Discussion & challenges

The proposal for the new regulation is not final yet and discussions are controversial. Thousands of amendments have been proposed. The single set of rules and the removal of administrative requirements are supposed to save money. But critics point out some issues

• The requirement to have a Data Protection Officer (DPO) is new for many EU countries and criticized by some for its administrative burden.
• The GDPR was developed with a focus on social networks and cloud providers, but did not consider requirements for handling employee data sufficiently.
• Data Portability is not seen as a key aspect for data protection, but more a functional requirement for social networks and cloud providers.
• Language and staffing challenges for the Data Protection Authorities (DPA):
  • Non-European companies might prefer the UK/Irish DPA because of the English language. This will require extensive resources in those countries.
  • EU citizens no longer have a single DPA to contact for their concerns, but have to deal with the DPA the company chose. Communication problems due to foreign languages have to be expected.
• The new regulation conflicts with other non-European laws and regulations and practices (e.g. surveillance by governments). Companies in such countries should not be acceptable for processing EU personal data anymore.
• The biggest challenge might be the implementation of the GDPR in practice:
  • The European Commission and DPAs have to provide sufficient resources and power to enforce the implementation and a unique level of data protection has to be agreed upon by all European DPAs since a different interpretation of the regulation might still lead to different levels of privacy.
  • The implementation of the EU GDPR will require comprehensive changes of business practices for companies that did not implement a comparable level of privacy until now (especially non-European companies handling EU personal data).
  • There is already a lack of privacy experts and knowledge as of today and new requirements might worsen the situation. Therefore education in data protection and privacy will be a critical factor for the success of the GDPR.

External links

• EU Data Protection page
• Procedure 2012/0011/COD, EUR-Lex
• 2012/0011(COD) - Personal data protection: processing and free movement of data (General Data Protection Regulation), European Parliament
• How to prepare for proposed EU data protection regulation (Computerweekly)
• Overview of proposed amendments by LobbyPlag