What is General Data Protection Regulation and why is it important?
The General Data Protection Regulation (GDPR) standardizes data protection law across all 28 EU countries and imposes strict new rules on controlling and processing personally identifiable information (PII). It also extends the protection of personal data and data protection rights by giving control back to EU residents. GDPR replaces the 1995 EU Data Protection Directive, and goes into force on May 25, 2018. It also supersedes the 1998 UK Data Protection Act.
There are many essential items in the regulation, including increased fines, breach notifications, opt-in consent and responsibility for data transfer outside the EU. As a result, the impact to businesses is huge and will permanently change the way customer data is collected, stored, and used.
GDPR applies to all organizations holding and processing EU resident’s personal data, regardless of geographic location. Many organisations outside the EU are unaware that the EU GDPR regulation applies to them as well. If an organization offers goods or services to, or monitors the behavior of EU residents, it must meet GDPR compliance requirements.
Fines for noncompliance are large. They can be as high as €20 million or 4% of a company’s total global revenue, whichever is larger. This is the maximum fine that can be imposed for the most serious violations, e.g. not having sufficient customer consent to process data or violating core Privacy by Design concepts. However, there is a tiered approach to fines, e.g. a company can be fined 2% for not having their records in order, not notifying the supervising authority and data subject about a breach, or not conducting an impact assessment. It is important to note that these rules apply to both controllers and processors.