The new General Data Protection Regulation (GDPR) from the European Union (EU) imposes new rules on organisations that offer goods and services to the people in the EU, or collects and analyses data tied to EU residents, no matter where the organisations or the data processing is located. GDPR comes into force in May 2018.
If your customers reside in the EU, whether you have a presence in the EU or not, then GDPR applies to you. The internet lets you interact with customers where ever they are, and GDPR applies to anyone that deals with EU people where ever they are.
And the term personal data covers everything from IP address, to cookie data, to submitted forms, to CCTV and even to a photo of a landscape that can be tied to an identity. Then there is sensitive personal data, such as ethnicity, sexual orientation and genetic data, which have enhanced protections.
And for the first time there are very strong penalties for non-compliance – the maximum fine for a GDPR breach is EU$20M, or 4% of worldwide annual turnover. The maximum fine can be imposed for the most serious infringements e.g. not having sufficient customer consent to process data or violating the core of Privacy by Design concepts.
Essentially GDPR states that organisations must:
- provide clear notice of data collection
- outline the purpose the data is being used for
- collect the data needed for that purpose
- ensure that the data is only kept as long as required to process
- disclose whether the data will be shared within or outside or the EU
- protect personal data using appropriate security
- individuals have the right to access, correct and erase their personal data, and to stop an organisation processing their data
- and that organisations notify authorities of personal data breaches.
Specific criteria for companies required to comply are:
- A presence in an EU country
- No presence in the EU, but it processes personal data of European residents
- More than 250 employees
- Fewer than 250 employees but the processing it carries out is likely to result in a risk for the rights and freedoms of data subject, is not occasional, or includes certain types of sensitive personal data. That effectively means almost all companies.
What does this mean in real terms to common large companies? Well…
- Apple turned over about USD$230B in 2017, so the maximum fine applicable to Apple would be USD$9.2B
- CBA turned over AUD$26B in 2017 and so their maximum fine would “only” be AUD$1B
- Telstra turned over AUD$28.2B in 2017, the maximum fine would be AUD$1.1B.
The GDPR legislation won’t impact Australian businesses, will it? What if an EU resident gets a Telstra phone or CBA credit/travel card whilst on holiday in Australia or if your organisation has local regulatory data retention requirements that appear, on the surface at least, at odds with GDPR obligations…
I would get legal advice if the organisation provides services that may be used by EU nationals.
In a recent PWC “Pulse Survey: US Companies ramping up General Data Protection Regulation (GDPR) budgets” 92% of responses stated that GDPR is one of several top priorities.
Technology cannot alone make an organisation GDPR compliant. There must be policy, process, people changes to support GDPR. But technology can greatly assist organisations that need to comply with GDPR.
Microsoft has invested in providing assistance to organisations impacted by GDPR.
Office 365 Advanced Data Governance enables you to intelligently manage your organisation’s data with classifications. The classifications can be applied automatically, for example, if there is GDPR German PII data present in the document the document can be marked as confidential when saved. With the document marked the data can be protected, whether that is to encrypt the file or assign permissions based on user IDs, or add watermarks indicating sensitivity.
An organisation can choose to encrypt their data at rest in Office 365, Dynamics 365 or Azure with their own encryption keys. Alternatively, a Microsoft generated key can be used. Sounds like a no-brainer, all customers will use customer keys. However, the customer must have a HSM (Hardware Security Module) and a proven key management capability.
Azure Information Protection enables an organisation to track and control marked data. Distribution of data can be monitored, and access and access attempts logged. This information can allow an organisation to revoke access from an employee or partner if data is being shared without authorisation.
Azure Active Directory (AD) can provide risk-based conditional access controls – can the user credentials be found in public data breaches, is it an unmanaged device, are they trying to access a sensitive app, are they a privileged user or have they just completed an impossible trip (logged in five minutes ago from Australia, the current attempt is from somewhere that is a 12 hour flight away) – to assess the risk of the user and the risk of the session and based on that access can be provided, or request multi-factor authentication (MFA), or limit or deny access.
Microsoft Enterprise Mobility + Security (EMS) can protect your cloud and on-premises resources. Advanced behavioural analytics are the basis for identifying threats before data is compromised. Advanced Threat Analytics (ATA) detects abnormal behaviour and provides advanced threat detection for on-premises resources. Azure AD provides protection from identity-based attacks and cloud-based threat detection and Cloud App Security detects anomalies for cloud apps. Cloud App Security can detect what cloud apps are being used, as well as control access and can support compliance efforts with regulatory mandates such as Payment Card Industry (PCI), Health Insurance Accountability and Portability Act (HIPAA), Sarbanes-Oxley (SOX), General Data Protection Regulation (GDPR) and others. Cloud App Security can apply policies to apps from Microsoft or other vendors, such as Box, Dropbox, Salesforce, and more.
Microsoft provides a set of compliance and security tools to help organisations meet their regulatory obligations. To reiterate policy, process and people changes are required to support GDPR.
Please discuss your legal obligations with a legal professional to clarify any obligations that the EU GDPR may place on your organisation. Remember May 2018 is only a few months away.