Glossary Terms
What is GDPR Compliance?
GDPR compliance (General Data Protection Regulation Compliance) means your company follows rules to keep your data safe and private, especially if they’re in the European Union (EU). This law took effect in 2018, and covers details such as: if you collect or use someone’s data, you need to obtain explicit permission, protect that data from leaks or hacks, and inform people how their data is being used, where it’s stored, such as in cloud platforms like M365 or Google Workspace, and how it’s backed up. Even if your business isn’t in Europe, you still need to follow these rules if you deal with EU data. Simply put, GDPR compliance is about respecting privacy and making sure you’re serious about data security. This includes practices such as data backup to ensure compliance and prevent data loss.
What are the 7 main principles of GDPR?
The GDPR is based on seven core principles. These principles guide how a business should handle your data, and help build trust, ensuring your data is respected, protected, and used responsibly:
- Lawfulness, fairness, and transparency
You must collect and use personal data in a lawful, fair, and transparent manner. Always tell people how and why you’re using their data. If you’re asking for their information, ensure there’s a valid reason behind it and explain that clearly.
- Purpose limitation
Use the data only for the specific reason you collected it. If someone shares their information for a service or to join a newsletter, you must use it for that purpose.
- Data minimization
Only collect the data that is necessary. Do not ask for extra information, “in case” you might need it later. If it is not essential to your purpose, do not collect it.
- Accuracy
Keep personal data accurate and up to date. For example, if an individual’s email address or contact details change, making sure the information is clean becomes your responsibility.
- Storage limitation
Do not retain personal data for longer than necessary. Destroy it after it has served its intended purpose, or anonymize it effectively. Use secure data backup methods to avoid accidental data loss and support data loss prevention strategies. Clearly explain the timelines for data retention and adhere to them.
- Integrity and confidentiality
Secure all data. Protect it from unauthorized access or accidental loss by applying proper security measures, such as encryption, passwords, and access controls. Ensure that you provide access to the data only to the authorized persons.
- Accountability
You’re responsible for following all of these principles and for proving that you do. That means maintaining documentation, training your team, reviewing your practices, and being prepared to demonstrate to regulators that you’re doing things the right way.
What is the GDPR compliance process?
Achieving GDPR compliance is a multi-step process. Businesses follow a step-by-step process to remain compliant with GDPR’s requirements, like:
Assess current data practices:
Evaluate how your team processes personal information. Begin the overview by outlining the information you collect, where the data is stored, how it is processed within your systems, and who has visibility into it. This will help you assess your adherence to GDPR and identify any risks or gaps in your approach. On the latter point, you might consider running a data audit, or if privacy is at risk, consider a data protection impact assessment (DPIA).
Plan remediation actions:
List all of the things your team should do to conform with the law: these may include updating your privacy policy and cookie notice, enhancing the protection of data, establishing a clear procedure for handling requests by users, and training staff in data protection. Finally, also check how your contracts with third-party vendors relate to GDPR compliance.
Implement changes:
Websites and apps must be up-to-date with cookie banners and clear, explicit privacy notices. Forms should be updated to collect only what is necessary, and clear consent is required for other types of data collection. Security needs to be ramped up by introducing encryption and restricting access to sensitive data, as well as instituting procedures to detect and report privacy breaches within 72 hours. In case of a GDPR requirement, assign a Data Protection Officer or EU representative. Train employees collectively so that everyone is aware of the new rules and understands how to comply with them.
Monitor and maintain compliance:
Your team needs to conduct regular checks of your data handling and perform audits to ensure that everything is still being done to their satisfaction. Everything in the data life cycle must be documented and periodically reviewed. Continue training your employees to keep them informed about data protection rules. Additionally, ensure you have a clear and updated plan for handling data breaches. If a breach happens, act fast, contain it, and report it to the authorities within 72 hours, as GDPR requires. Make privacy a part of your daily work so you can stay prepared for new risks and comply with the law over time.
GDPR compliance requirements explained
Apart from those high-level principles, the GDPR outlines definite requirements with which organizations must comply. Some of the major compliance requirements include the following:
Lawful basis and consent:
You must have a legal basis to process personal data, which, in most instances, means clear and affirmative consent from the individual unless a contract/another legal obligation applies. Under GDPR, pre-ticked boxes or implied consent are insufficient because the user must have given informed permission before you collect or use their data (i.e., opt-in). Stricter conditions apply to special categories of sensitive data. Always maintain a record of the legal basis for processing all types of data.
Transparency and notices:
GDPR requires you to be clear about how you handle personal data. Show easy-to-find privacy notices that explain what you collect, why, for how long, and who you share it with. This information should be provided at the point of data collection (for example, in a website’s privacy policy or an employee privacy notice) in clear and plain language. When one’s data usage changes, it is necessary to notify the relevant person. Transparency breeds trust, and being transparent is a key cornerstone of compliance.
Individual data subject rights:
Data requests under the GDPR enable individuals to view, rectify, delete, or restrict the use of their data. Data portability to another service or contesting decisions made by automated processes are other rights they have.
Be prepared to deal with the requests promptly – usually within one month. For instance, upon receiving a request for data deletion, locate and delete such data from all locations, and duly inform the requestor.
Data security measures:
Ensure that personal data is protected against leaks, hacks, and misuse. Have data encrypted, whether it is base data or shared data. Create firewalls, utilize intrusion detection tools, and update software to fill the gaps. Access must be restricted to only those persons who are necessary.
GDPR requires that data be maintained in an intact and secure manner. An incident response plan must be in place. Data authorities should be notified of a data breach within 72 hours of its detection. Notify the persons who are at risk in the event of any exposure of sensitive data.
Accountability and documentation:
It is to maintain a record for all personal data collection, its origin, and shares. If it involves sensitive data, you must conduct a Data Protection Impact Assessment (DPIA) to demonstrate that privacy risks exist and are adequately mitigated.
Most public authorities will be required to appoint a Data Protection Officer (DPO) to manage sensitive data. Most organizations choose to put a designated person in charge of their privacy practices, even if they are not required to do so. It is a case where one does not have an office in Europe but still handles the customer’s data in Europe; therefore, they will need an EU representative through whom they respond to the EU’s regulators.
What happens if GDPR is breached?
Failing to comply with the GDPR can result in severe consequences for an organization. The GDPR empowers regulators, such as national Data Protection Authorities in EU countries, to enforce the law through investigations and hefty fines. Here’s what can happen if GDPR is breached:
You can face heavy fines
If you break GDPR rules, regulators can fine you up to €20 million/$23M or 4% of your global annual revenue, whichever is higher. Even minor violations can result in fines of up to €10 million/$11.8M or 2% of your annual turnover. These fines are real. For example, Meta (Facebook) was fined €1.2 billion/$1.4B in 2023 for mishandling EU user data.
Regulators may force you to act quickly
Regulators can do more than just impose fines. They can also ask you to take immediate actions to address compliance problems. This could involve changing your privacy policies, ceasing data collection, or even suspending your business activities until those issues are resolved. In dire cases, they may order the complete cessation of processing of certain categories of data. These acts can disrupt operations and change the means by which you plan to serve your customers.
By the way, regulators do impose penalties; they may direct immediate measures to cure compliance shortcomings. This may involve amending privacy policies, ceasing data collection, or even halting business activities until those issues are resolved. In such situations, they may even direct the complete prohibition of processing certain types of data. These actions would hinder your operations and impede your ability to serve your customers effectively.
Your company’s reputation can suffer long-term damage
If your company gets hit with a GDPR violation, it usually becomes public. Either because you’re required to notify affected individuals, or because the media reports it. Customers and partners may start to question how seriously you take privacy. Even if you recover legally, the damage to your brand can take years to rebuild. Many companies end up spending a significant amount on public relations and enhanced security after such an incident.
You may face legal action from individuals
The injured beneficiaries of a data breach, those who suffer identity theft, fraud, or emotional distress, are empowered to sue. Under the GDPR, individuals are entitled to claim damages against any corporation for the misuse of their data or for failing to adequately secure it. Such a scenario could easily escalate into lawsuits or, in large-scale cases, class action lawsuits. The combined cost of legal fees and settlements could become substantial. Implementing proper data backup and data loss prevention strategies can help avoid such consequences.
Your operations may be disrupted
A GDPR breach can trigger deeper investigations into how your business handles data. You may need to bring in legal experts, conduct system audits, and allocate time to address vulnerabilities. During this time, teams may be pulled away from their regular work. If third-party vendors were involved in the breach, it could also affect your contracts and lead to disputes or penalties.
Related Glossaries
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