The GDPR Compliance Deadline Has Arrived—Are You Prepared?
 

The GDPR Compliance Deadline Has Arrived—Are You Prepared?

Posted on 06-22-2018

By: Nicholas R. Merker, Ice Miller LLP

The deadline for organizations to comply with the European Union (EU) General Data Protection Regulation (GDPR) is upon us.1 As of May 25, 2018, all entities covered under the GDPR must be able to demonstrate their compliance to EU regulators. The expanded territorial reach of the GDPR means organizations in the United States must comply if they either offer goods or services to individuals in EU member states and select other countries or monitor individuals’ behavior in those nations.

THE FAILURE TO COMPLY WITH THE GDPR MAY NOW trigger steep administrative fines of up to €20 million or 4% of the organization’s global annual revenue, whichever is greater. Notably, the GDPR does not apply solely to commercial businesses—not-forprofit organizations, charities, and educational institutions may all fall within the regulation’s purview.

What Is the GDPR?

Put simply, the GDPR is a regulation requiring organizations that process the personal data of individuals in the European Economic Area (EEA)2 to institute strong data protection mechanisms, incorporate privacy principles into the design of business processes, and allow EEA individuals to exercise certain rights over their personal data. The GDPR replaced the EU Data Protection Directive3 and creates more robust requirements for protecting EEA personal data.

The GDPR also significantly expands the territorial scope of European data protection law. Even organizations in the United States will need to comply with the GDPR if they either offer goods or services to EEA individuals or monitor EEA individuals’ behavior. Accordingly, your organization may be required to comply with the GDPR even if it does not have a physical presence in Europe.

Who Needs to Comply?

Consider the following examples of scenarios in which your organization may need to comply with the GDPR:

  • Your company operates a website or mobile app that targets EEA users.
  • You track and monitor the online behavior of EEA users of your company’s website or mobile app.
  • Your multinational company performs human resources activities for its employees and job applicants residing in the EEA.
  • Your company’s customer base includes businesses located in the EEA.
  • Your organization receives charitable donations from EEA individuals.
  • Your educational institution processes admissions applications submitted by prospective students currently residing in the EEA.

10 Key Compliance Areas

Because of the wide-reaching application of the GDPR, every organization should evaluate whether it has any GDPR compliance obligations. If you determine your organization is subject to the GDPR, we suggest focusing your initial compliance efforts in the following 10 key areas:

  1. Create a Data Map for Personal Data. A deep understanding of how your organization creates, receives, maintains, or transmits personal data about EEA individuals is foundational to a GDPR compliance program. Additionally, it is important to ascertain whether your organization processes special categories of personal data, such as information about racial or ethnic origin, political opinions, religious beliefs, trade union membership, sex life or sexual orientation, medical or genetic information, or biometric data.
  2. Inventory Processing Activities. The GDPR requires an organization to create detailed records of all of its processing activities. This step is not only necessary for demonstrating your organization’s GDPR compliance to a regulator, but it is also helpful in identifying which of your practices and operations will need to be scrutinized for consistency with the GDPR’s requirements.
  3. Assess the Scope of Your GDPR Compliance Obligations. The extent of your GDPR obligations depends on whether your organization is best characterized as a “data controller” that determines the purposes for which processing activities are carried out or a “data processor” that handles personal data on behalf of a data controller. Sometimes an organization may be both a controller and a processor. For instance, it may be a data controller to the extent it performs human resources functions for its EEA employees and a data processor with respect to personal data received from EEA customers.
  4. Identify Legal Bases for Processing Activities. The GDPR enumerates several bases for the lawfulness of a processing activity. For example, a processing activity may be lawful if consent has been obtained from the individual data subject, the processing is necessary for the performance of a contract entered into with the data subject, the processing is necessary to comply with applicable legal requirements, or the processing is necessary for the organization’s legitimate interests. Your organization should be prepared to articulate a legal basis under the GDPR for each category of processing activities in which it engages.
  5. Implement Valid Consent Mechanisms. The GDPR includes stringent requirements for obtaining an individual’s consent to the processing of personal data. Your organization should carefully implement valid mechanisms to obtain individuals’ consent to those processing activities involving special categories of personal data and for which you have identified consent as the legal basis. Along with consent mechanisms, your organization should ensure it provides meaningful notices to individuals of the purposes of its processing activities that satisfy GDPR requirements.
  6. Evaluate Processes for Protecting Individuals’ Rights. Under the GDPR, individuals have enhanced rights with respect to their personal data, including the rights to transparency, access, rectification and erasure, restrict processing, object to certain types of processing, and data portability. Your organization should decide how it will operationalize the GDPR’s requirements for protecting individuals’ rights over each category of personal data you process.
  7. Examine Vendor Relationships. Whether your organization is functioning as a data controller or a data processor, the GDPR requires you to update relevant vendor contracts to impose specific data protection obligations on them. Further, data processors are required to obtain general or specific consent from the data controller to whom it is providing services before outsourcing any processing activities to vendors.
  8. Assess Data Security Practices. Your organization should have a documented plan for complying with the GDPR’s requirements for protecting the confidentiality, availability, and integrity of EEA personal data and the resilience of systems processing such data.
  9. Appoint a Data Protection Officer (DPO) and/or a Europe-Based GDPR Representative. Under some circumstances, the GDPR requires an organization to appoint a DPO. A DPO must have expertise in data protection laws and can be either an external service provider or an employee of the organization, as long as the DPO does not experience a conflict of interests when performing his or her duties. The DPO would serve as the organization’s point of contact for regulators and be responsible for various GDPR compliance efforts, including training staff, conducting audits, and advising on data protection impact assessments of proposed or existing processing activities. Moreover, the GDPR requires organizations without a European establishment to appoint a GDPR representative based in the EEA.
  10. Develop an Internal GDPR Policy Manual. Although not explicitly required by the GDPR, we recommend creating an internal GDPR Policy Manual that your organization can not only use as a foundation for employee training, but also produce to regulators to showcase your compliance. The manual may contain policies and procedures that address topics such as consent mechanisms, individuals’ rights, vendor management, meeting the GDPR’s strict breach notification requirements, when to perform data protection impact assessments, receiving and investigating privacy complaints, handling special categories of data, international transfers of personal data, data retention requirements, and the concepts of privacy by design and privacy by default.

This article was published in the May 2018 issue of Pratt’s Privacy & Cybersecurity Law Report. All rights reserved. Visit the website to subscribe.


Nicholas R. Merker is a partner in and co-chair of Ice Miller LLP’s Data Security and Privacy Practice. His technology background gives him the unique ability to bridge the gap between lawyers and technologists, often translating between the two disparate disciplines to resolve legal issues. Clients seek Nick’s counsel in all areas where data security and privacy are an issue, including PCI-DSS, the HIPAA Security Rule, online privacy statements, vendor contract issues, the EU GDPR, anti-SPAM issues, regulatory enforcement, privacy due diligence in mergers and acquisitions, privacy audits (i.e. GAPP), and data security standards and audits (i.e. NERC, SSAE 16, etc.). The author may be reached at nicholas.merker@icemiller.com.


To find this article in Lexis Practice Advisor, follow this research path:

RESEARCH PATH: Data Security & Privacy > International Compliance > General Data Protection Regulation (GDPR) > Practice Notes

To learn more about the European Union General Data Protection Regulation (GDPR), see

> GENERAL DATA PROTECTION REGULATION (GDPR)

RESEARCH PATH: Data Security & Privacy > International Compliance > General Data Protection Regulation (GDPR) > Practice Notes

For a sample GDPR privacy policy, see

> PRIVACY POLICY (GDPR COMPLIANT, GENERAL)

RESEARCH PATH: Data Security & Privacy > International Compliance > General Data Protection Regulation (GDPR) > Expert Forms

For a discussion on GDPR protection principles, see

> PROTECTION PRINCIPLES UNDER THE GENERAL DATA PROTECTION REGULATION (GDPR)

RESEARCH PATH: Data Security & Privacy > International Compliance > General Data Protection Regulation (GDPR) > Practice Notes

For an explanation of the consent requirements under the GDPR, see

> CONSENT UNDER THE GENERAL DATA PROTECTION REGULATION (GDPR)

RESEARCH PATH: Data Security & Privacy > International Compliance > General Data Protection Regulation (GDPR) > Practice Notes

To explore the data portability rights and requirements pursuant to the GDPR, see

> DATA PORTABILITY UNDER THE GENERAL DATA PROTECTION REGULATION (GDPR)

RESEARCH PATH: Data Security & Privacy > International Compliance > General Data Protection Regulation (GDPR) > Practice Notes

For more information on GDPR enforcement and sanctions, see

> SANCTIONS AND ENFORCEMENT UNDER THE GENERAL DATA PROTECTION REGULATION (GDPR)

RESEARCH PATH: Data Security & Privacy > International Compliance > General Data Protection Regulation (GDPR) > Practice Notes

To examine pro-controller data processing clauses, see

> DATA PROCESSING CLAUSES (DPA 1998 AND GDPR COMPLIANT, PRO-CONTROLLER)

RESEARCH PATH: Data Security & Privacy > International Compliance > General Data Protection Regulation (GDPR) > Expert Forms

To examine pro-processor data processing clauses, see

> DATA PROCESSING CLAUSES (DPA 1998 AND GDPR COMPLIANT, PRO-PROCESSOR)

RESEARCH PATH: Data Security & Privacy > International Compliance > General Data Protection Regulation (GDPR) > Expert Forms

1. General Data Protection Regulation (EU) 2016/679, http://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32016R0679&from=EN. 2. The European Economic Area consists of EU member states and Iceland, Liechtenstein, and Norway. 3. EU Data Protection Directive 95/46/EC. Unlike the GDPR, the EU Data Protection Directive was not a regulation that was immediately legally binding on EU member states. Instead, the directive required each EU member state to interpret the directive’s standards and pass national legislation to implement them.