For multinational organizations — or for any business that transfers data across state borders— maintaining data privacy is an ongoing challenge. With frequent changes in the regulatory landscape, it’s often difficult to even understand which privacy laws your organization is subject to.
Fortunately, modern tools like artificial intelligence can help. Learn how to build a privacy program that protects sensitive information, strengthens data security, and supports privacy compliance.
Who Is Impacted by Data Privacy Regulations?
The short answer is almost everyone is subject to some data privacy regulations.
In the past, the sectors subject to data privacy regulations were largely limited to:
- Healthcare
- Financial services
- Retail
Today, though, there’s been an explosion in data protection laws at the regional, national and international levels. At the same time, there’s been a major uptick in the use of personal data. Together, these factors mean that more companies need to create privacy programs with documented privacy policies and clear accountability.
Just about every business today engages in data collection, making them subject to laws governing how personal data is protected and how organizations respond to a potential data breach. What’s more, many companies today do business in more than one country or region, which further changes the risk map and impact assessments.
If you do business in a region governed by data protection laws, then you are subject to those laws, even if your company is headquartered elsewhere. For example, if you do business with customers in the EU, you’re subject to the GDPR. Likewise, if you do business with California residents, you fall under the CCPA.
McKinsey estimates that more than 75% of the countries in the world have data residency regulations in place. If you do business in any of those countries, you’re bound by those regulations as well. If you do business in more than one country with data residency regulations, compliance becomes even more complicated.
Navigating the Fragmented Regulatory Landscape
Today’s regulatory landscape is incredibly complex and fragmented, with competing and sometimes contradictory privacy laws governing data protection from region to region. If you do business across borders, you’ll likely need to comply with a patchwork of different laws, both data privacy regulations and data localization laws.
Data Privacy Regulations
The GDPR and CCPA are probably the best-known data privacy regulations, but they’re far from the only ones.
Brazil has an extensive data protection law known as the LGPD (Lei Geral de Protecao de Dados Pessoais). If you handle data belonging to anyone in Brazil, then you are subject to the LGPD. Canada’s PIPEDA (Personal Information Protection and Electronic Documents Act) likewise governs anyone who handles private data belonging to anyone in Canada.
In the United States, a patchwork of laws governs data protection. Some states have regulations about the use of their residents’ data while others do not. California, Virginia, Colorado, and Connecticut have been at the forefront of data regulations, but 16 other states also have protections in place, and the list keeps growing.
Unsurprisingly, the state laws are all different from each other. If you’re doing business in the United States, you’ll need to carefully track the privacy program frameworks that impact you, along with your different privacy notice obligations.
Sector-Specific Data Protections
If you do business in the United States, you may also be subject to industry-specific regulations, like the Health Insurance Portability and Accountability Act, or HIPAA, the Gramm-Leach-Bliley Act (GLBA), the Children’s Online Privacy Protection Act (COPPA) or the Family Educational Rights and Privacy Act (FERPA). These regulations each define required privacy controls, information security expectations, and ongoing regulatory requirements.
Data Localization Laws
A majority of countries have implemented some form of data localization or data sovereignty law. There is no centralized law to govern data across all of these countries. Instead, organizations must find a way to comply with the unique rules in every country where they do business.
Broadly, data localization requires organizations to store and process data within that country’s borders. The laws also set out guidelines for transferring data across borders to minimize privacy risks and support effective risk mitigation.
There is substantial variation among these laws. For example,Russia requires organizations to seek permission before transferring any data outside of the country while Australia allows the transfer of most data but prohibits the transfer of sensitive health records outside of the country.
Dealing With Multiple Regulations
Depending on your organization, you may be subject to multiple regulations at once. It’s not uncommon for a business to be regulated at the regional, industry and international levels.
Regulations can sometimes contradict each other, which naturally makes compliance more difficult and increases the need for ongoing risk assessments. For example, the GDPR requires citizens to explicitly “opt in” to allow organizations to use their private data. In contrast, the CCPA allows organizations to use data without explicit consent — but it does give people the right to “opt out” of data sharing.
These contradictions can make it difficult to operate your business. That’s why it’s important to follow the established best practices. It’s also wise to incorporate data privacy into your GRC program and manage data compliance using a unified GRC software solution, like Onspring’s platform. This will ensure that you always have the best possible tools to drive regulatory compliance.
Best Practices for Compliance With Data Protection Laws
Here are some of the best practices privacy professionals use to implement effective privacy controls and streamline your data privacy workflows, so compliance is easier to attain and maintain.
Plan Ahead for Data Residency
Data residency refers to the physical location of your organization’s data. Under data localization laws, you are required to store data in its country or region of origin. In order to comply with the law, planning for data residency is crucial.
Today, many organizations use software to track and plan data residency. Data privacy tools, like Onspring’s compliance management software, create a centralized data map that shows where your information is stored, supporting stronger data security, so you can quickly visualize and locate all of your information and ensure that it is held in the correct location.
Privacy management software also makes it easy to respond to Data Subject Access Requests (DSARs). The tools give you instant visibility into your data privacy program’s effectiveness, tracking trends and helping you to improve on areas of weakness.
Tackle the Challenges of Cloud Architecture
Unfortunately, the prevalence of cloud computing can complicate data privacy compliance. In particular, cloud computing can make data residency difficult, since organizations often store data on remote servers. Cloud computing often entails using data centers located in third-party countries and operated by multinational businesses.
You can resolve these challenges by implementing geo-fencing strategies to prevent data from moving across borders. You can also work closely with your data center provider to determine where your data will be stored.
Privacy management software gives you visibility into your data, so that you can easily determine whether it’s stored in the appropriate geographical location, even when you’re using cloud computing solutions.
Use Integrated GRC Platforms To Simplify Privacy Management
Faced with the complexity of modern privacy laws, successful GRC professionals are using integrated platforms to streamline the management process and scale their data privacy program.
The right platform brings all of your workflows together in one place, supports multiple content types and automates key processes. Cumbersome tasks like collecting Data Subject Requests, for example, can be automated, saving time and reducing human error.
Data privacy management tools create a centralized repository– or resource center– for all of the relevant compliance data, making it easy to report and answer questions. Instead of a web of disparate systems, you have one platform to consult.
Onspring’s GRC software reduces complexity and streamlines processes throughout the data privacy compliance process. That’s why our software is the top-ranked GRC software suite. If you’re looking for a deeper, practical guide, download the ebook Data Privacy in the Age of AI to learn how to build a scalable privacy program that supports long-term privacy compliance.
