Updated on February 12, 2020
Staying Ahead in a Post-GDPR World: Why Data Processing Agreements Are Critical For Business
The GDPR is the most significant data protection shake-up in 25 years. What has become evident in the almost 2 years since it came into force, however, is that many businesses are still struggling to understand and implement it.
Many of the headlines have been security-focused or riddled with consternation and the burden for businesses. But there have been benefits, too.
The Impact of Data Protection Laws
The new regulations have had a monumental effect on the awareness and tackling of privacy issues in both the public eye and senior management level.
The GDPR and California’s landmark privacy law, CCPA, can function as a roadmap for businesses to establish a strong data governance program. Critically, they bring regulation into the modern age with respect to the evolving digital economy and trigger exciting new opportunities and long-term benefits for businesses.
These benefits include greater agility and innovation. According to Cisco’s latest data privacy study, 42% of the companies surveyed said that meeting the GDPR is helping them to broaden innovation thanks to the right data controls being in place. Other benefits are reduced reputational risk and improved cyber resilience.
Companies are beginning to understanding that good information handling equals good business sense, and it’s difficult to argue with that.
The Dawn of Data Processing Agreements
One of the consequences of GDPR is that companies are undertaking a significant redevelopment of their data handling capabilities in order to comply. Businesses are increasingly looking at the way that they handle the personal data of their customers and putting an action plan in place to safeguard their privacy.
The change to the law regarding data controllers and data processors, in particular, has significant implications for businesses. Under the GDPR, it is essential for organizations involved in the processing of personal data to determine whether they are acting as a data controller or as a data processor in respect of the processing.
This is especially important in the case of a data breach, where it is necessary to determine which entity has overarching responsibility for data protection.
Data Processing Agreements (DPAs) are designed to satisfy that obligation, and failure to have one in place is a breach of the law under GDPR.
DPAs Are Critical For Business Deals
The DPA regulates the scope and purpose of data processing, and specifies the rights and obligations of your organization and your data processors.
It provides the peace of mind and assurance that your data processor, and any third party subcontractor they might use, perform adequate due diligence to protect the privacy of the personal data you have been entrusted with.
These contracts were simpler in the days before GDPR, and even disregarded in some cases. However, the DPA is a critical component of business deals under the new data protection laws and can no longer be ignored.
Compliance starts with the right foundation. Investing in a sustained data management and governance program that includes a solution for DPAs provides businesses with a competitive advantage. Essentially, it enables them to position themselves as innovators and market leaders in a post-GDPR world.
For more information, check out The Essential Guide to Data Processing Agreements, which provides all the information in one convenient place.
Judi Crimmins is a jurist, writer, and the Director of Global Marketing at LawGeex. Previous companies include BSI Group and British Water. Judi holds a Master of Laws (LLM) from the University of London. Connect with her on LinkedIn.