The General Data Protection Regulation (GDPR) will take effect in the UK on 25 May 2018. This short guide briefly sets out:
- Who the GDPR will affect and its scope;
- Whether the UK’s decision to leave the EU will have any impact on the GDPR; and
- The key changes that the GDPR will make to the existing data protection regime in the UK.
Who the GDPR will affect
Who is subject to the GDPR and what does it cover?
WHO: The GDPR applies to any organisation that has control over personal data as well as those that process personal data on behalf of another organisation. Under existing law, it is the organisation that has control over data that is responsible for ensuring compliance with data protection law. This will change under the GDPR, with some provisions directly applicable to processors.
WHAT: The GDPR continues to protect ‘personal data’ that identifies a living individual (as is covered under the Data Protection Act 1998) but the definition of ‘personal data’ has been clarified to make clear that personal data includes, for example, an IP address.
Brexit impact on the GDPR
The GDPR is an EU regulation that is directly applicable to EU member states from 25th May 2018 without the need for domestic UK legislation (and so will apply between May 2018 and any departure from the EU)
When the UK does officially leave the EU, the GDPR will no longer be directly applicable into UK law. However, the UK has decided to incorporate the provisions of the GDPR into the new Data Protection Bill (with some derogations).
What’s new under the GDPR?
The legal basis for processing data
Under the GDPR, individuals’ rights will, in many cases, vary depending on the legal basis on which organisations hold their data. These legal bases remain the same as under the current law and are set out below for ease of reference:
- Processing is necessary for the performance of a contract;
- Processing is necessary for compliance with a legal obligation;
- Processing is necessary in order to protect the vital interests of the data subject or another natural person
- Processing is necessary for the performance of a task carried out in the public interest or in the exercise of official authority vested in the controller;
- Processing is necessary for the purposes of the legitimate interests pursued by the interests or fundamental rights and freedoms of the data subject which require protection of personal data, in particular where the data subject is a child.
If you cannot rely on any of the above then you will need to ensure that the data subject has given consent to the processing of his or her personal data for one or more specific purpose (see point 2 below).
Following the introduction of the GDPR, it will be important for organisations to understand the legal basis upon which they hold data because:
- individuals will have a stronger right to have their data deleted if the legal basis upon which their data is held is based on consent;
- privacy notices must specify the legal basis for processing data; and
- this information must be included in response to any subject access request.
ACTION: Identify the grounds on which your organisation processes personal data and create a means of recording this so that the information can be utilised. Review the contracts in place between your organisation and data subjects to ascertain what legal basis, if any, can be relied on for the processing of personal data.
Consent to process data
Consent is just one of the mechanisms for justifying the processing of an individual’s data. In order for consent to be valid, it must be given freely, be specific, informed and unambiguous. As such, this is interpreted to mean that organisations may need to obtain separate consent for each processing activity.
Consent will only be valid if it is actively given – it cannot be inferred from inactivity (for example, leaving a box checked). Under the GDPR, an individual has the right to withdraw their consent to data processing at any time. As such, organisations will need to have appropriate procedures in place that enable it to record when consent has been given, identify the data to which the consent applies and delete or cease processing that data when consent is withdrawn. Many businesses are seeing the GDPR as a good prompt to cleanse and consolidate their databases.
From May 2018 all direct marketing by electronic means has to be on the basis of this type of ‘affirmative action’ consent. Consent must be given on the basis of a granular approach to the detail of the types of activity contemplated. We envisage a dashboard style mechanism for obtaining consent.
ACTION: Assess whether your organisation relies on consent to process data and then consider if your method to obtain consent is valid under the GDPR. Review marketing consents; do not rely on old direct marketing consents that were valid under the old law as they may not necessarily be valid under the new law. Take advice on how to obtain consent under the new law.
Under the current law, organisations are obliged to give individuals certain information when collecting their data, such as the identity of the organisation and how it intends to use the data. The GDPR expands this to include further information, including:
- the legal basis for processing the data;
- the organisation’s data retention periods; and
- information about the individual’s right to complain to supervisory authorities (the Information Commissioner's Office (ICO) in the UK)).
ACTION: Review and update your organisation’s privacy policies and privacy statements to ensure that they contain all the necessary information required under the GDPR.
Subject access requests
The GDPR will make several changes to the subject access request procedure. From 25 May 2018, organisations:
- will no longer be able to charge for subject access requests (except in exceptional circumstances where the request is manifestly unfounded or excessive);
- must comply with subject access requests within one month of the request;
- will need to provide additional information with responses to requests including information about data retention periods and the right to have inaccurate data corrected; and
- will have to respond to requests for information electronically and provide the information in a commonly used format.
ACTION: Review internal subject access request procedures to ensure efficiency within the new timescales. Ensure that responses to subject access requests can be sent electronically in an appropriate format. Ensure that your staff can recognise when a Subject Access Request has been made and understand that a Subject Access Request can come into the organisation via various means, for example verbally or via a post on your organisation’s social media page.
Rights for individuals
The GDPR introduces new rights for individuals. In particular, organisations should be aware of the following rights afforded to individuals:
- The right to have inaccuracies in data corrected. If an individual requests that their data is corrected, organisations must respond to the individual within one month and inform any third party to whom such data has been disclosed.
- The right to have information erased. Organisations must comply with a request to erase data in certain circumstances, including where holding the personal data is no longer necessary for the purpose for which it was originally collected or if the individual withdraws their consent.
- The right to data portability. Individuals have a right to move or copy their data to other IT services. To comply, an organisation must provide data to the individual in a commonly used machine readable form that would enable other organisations to read and extract such data.
- The right to object to data processing (including profiling). The GDPR gives individuals the right not to be subject to a decision based purely on automated processing if it would produce a legal effect or other significant effect on the individual.
ACTION: Ensure that your internal systems are capable of updating or erasing personal data when necessary and able to respond to an individual exercising any of their rights under the GDPR. Consider providing training to staff on how to recognise requests from individuals relating to their personal data.
Data protection impact assessments
Data protection impact assessments (DPIAs) are encouraged under the current data protection regime, but the GDPR will make them mandatory in some circumstances. A DPIA must be carried out whenever an organisation is planning to carry out “high risk” processing. Examples of “high risk” processing include profiling individuals and processing sensitive personal data on a large scale. If the risk cannot be mitigated, the organisation must consult the relevant supervisory authority (e.g. the ICO).
ACTION: Implement internal processes to flag when a DPIA is needed and a procedure for carrying this out.
Appointing a Data Protection Officer
Organisations (whether acting as data controller and/or data processor) will need to determine if they need to appoint a mandatory Data Protection Officer. Organisations that will be required to appoint a mandatory Data Protection Officer are:
- Public bodies;
- Organisations that carry out regular and systematic monitoring of data subjects on a large scale; or
- Organisations whose core activities consist of the processing on a large scale of special categories of data and personal data relating to criminal convictions and offences.
This could mean appointing someone to carry out this role internally or appointing an external advisor to take responsibility for your organisation’s data protection compliance.
ACTION: Establish if your organisation needs to appoint a mandatory Data Protection Officer.
Children’s personal data
The GDPR brings in a new protection in respect of the data of children in the context of internet services (such as social media). Organisations that collect personal data about children under 16 under the GDPR (although this is restricted to children “under 13” in the UK) will need to obtain consent for the processing from the child’s parents/guardian and ensure that privacy notices are in a language understood by children.
ACTION: Consider whether you have an effective means of determining the age of the people that you collect data from and, if necessary, ensure that parental/guardian consent mechanisms are put in place.
Record-keeping and accountability
Organisations must demonstrate their compliance with the GDPR by keeping accurate records of their processing activities. Organisations can also demonstrate compliance by having in place appropriate internal data protection policies, providing training to staff and conducting audits.
ACTION: Review and update your internal compliance policies and implement a procedure to keep appropriate records of your data processing activities.
Data breaches and fines
All organisations will be required to notify supervisory authorities in the event of a data protection breach where an individual is likely to suffer damage (such as identity theft). For breaches of the GDPR, supervisory authorities can fine an organisation up to 4% of its annual worldwide turnover or €20 million (whichever is the higher).
Organisations will also have to notify the individual concerned in certain circumstances (for example if the breach may cause the individual financial loss). Individuals will also have the right to claim compensation for financial loss or distress resulting from a data breach.
Director’s liability is also now introduced by virtue of the UK Bill, incorporating provisions directly from the Data Protection Act 1998. The draft UK Bill (which is currently making its way through Parliament) provides for directors, officers and managers to be personally liable to be punished where it is proven that the company has committed an offence and where that offence was committed with the consent or connivance of the officer, or attributable to their neglect.
The draft UK Bill provides that offenders will be personally liable “to be proceeded against and punished accordingly”, although it is not clear from the draft Bill what form any such punishment would take.
ACTION: Notify key stakeholders of the potential fines for breach of the GDPR.
What should you be doing now?
If your organisation has not yet assessed how it will comply with the GDPR (or indeed current data protection legislation), it is advisable to do so as soon as possible to ensure that changes can be implemented before the GDPR comes into law in May 2018.
Besides obvious changes such as appointing a Data Protection Officer and updating privacy policies, organisations will need to ensure that they have sufficient internal policies and procedures in place to comply with the new rules. For example, if a customer requested that an inaccuracy in the data you hold about them be corrected, could your organisation efficiently locate the data and make the change? Do you have effective internal procedures for identifying when a privacy impact assessment is required?
Would anyone within your organisation recognise a Subject Access Request (SAR)? Is it clear who would deal with a SAR and how? Regardless of whether you are a processor or the data controller, have you included within your contracts how to identify when a data breach has occurred and when you should inform the data controller that there has been a data breach? The data controller should be informed immediately upon the processor identifying a data breach as the controller has only 72 hours to notify details of the data breach to the ICO.
We can help protect your organisation by carrying out a review of your existing contracts, policies and practices and provide recommendations to help your organisation comply with the GDPR. We can also train your Data Protection Officer.
This guide reflects the provisions of the GDPR at the date of publication of this guide.