Data security has been on everyone’s mind for the last couple of decades. As with any new form of technology, it takes some time to work out the kinks, and in the meantime, unscrupulous parties will exploit weaknesses, leaving legislators and businesses to play catchup. Few companies understood the true value of system backups until ransomware became widespread and there was no other option but to pay the ransom to retrieve data.
We’re to the point now where technology users are ready to get out ahead of the problem and create proactive solutions, rather than waiting for hackers and cyber criminals to come up with newer and more diabolical means of stealing data and disrupting business. In this regard, the UK is currently ahead of the pack, thanks to the implementation of the GDPR. What is the GDPR and why are American businesses getting on board? Here’s what you need to know to protect your business and continue operating on a global scale.
What is the GDPR?
The General Data Protection Regulation, or GDPR, went into effect across the European Union (EU) as of May 2018. The regulation applies to any businesses that deal with EU citizens and it has to do with the collection and processing of sensitive personal information. It is designed to protect individual rights where data management is concerned.
Key features include the onus of companies to get consent for usage of data collected, transparency about how data will be used, notification of data breach to authorities within 72 hours, provisions for consumers to access and edit personal data, and most important to many companies and consumers, the right to be forgotten (as in, the right to request that consumer information be erased), among other things.
Businesses that fail to comply with GDPR rules could face a variety of penalties, including massive fines of up to 20 million euro or 4% of a company’s global annual revenue. While warnings and reprimands are likely to occur first, depending on the infraction, bans could also be issued, impacting an offending company’s ability to conduct business in the EU.
Do American Businesses Have to Comply?
The GDPR obviously affects businesses operating in the EU, but it may not necessarily affect companies in other parts of the world. The legislation focuses not so much on businesses, but on consumers and consumer rights when it comes to data management. For U.S. businesses that don’t deal with EU citizens, there is no need to comply with GDPR rules.
If, on the other hand, your business has offices and/or customers in the EU, you will almost certainly want to comply with the GDPR in order to avoid potentially hefty penalties. If you have plans to expand into EU markets, you’ll have to comply. If you even work with other companies in the EU, it’s a good idea since the GDPR prohibits EU companies from sharing consumer data with outside companies if they don’t comply with regulations.
Keep in mind that you don’t have to collect any form of payment from EU citizens for this law to apply to you. If you’re collecting any personal data, your company is affected. It’s a bold and wide-ranging initiative that could significantly impact the way business is conducted on a global scale.
Other Reasons to Follow GDPR Rules
The U.S. has yet to show any inclination of following in the EU’s footsteps where data security regulations like the GDPR are concerned, but businesses that care about consumer protections, or at least care about the damage caused by data breach and identity theft, may want to go the extra mile to up their security.
Whether you want to upgrade security in keeping with GDPR rules to continue current operations in the EU or you simply want to plan for the future and take precautions to protect your customers in the U.S. and other parts of the world, an experienced IT services partner like CTI Technology can help you determine the best way to proceed.