Last week, CNIL, the French data protection agency, handed Google the largest ever GDPR penalty (€50m) for its lack of transparency in how it collected and used personal data for personalised advertising.

This is of course a landmark case in the implementation of GDPR. Importantly, it also shows that despite fears pre-May 2018, European DPAs will not be perturbed by the legal resources that some of the biggest companies in the world have at their disposal – despite the entirely predictable appeal that Google lodged almost immediately.

But the case also raised two interesting points for privacy professionals: a debate over bias in which cases are pursued by DPAs, and how the “one stop shop mechanism” is applied in practice.

1. Is there bias in which cases DPAs pursue?

Within many of the CNIL-Google media reports, there were accusations that CNIL showed nationalist bias in punishing US-based Google, while not displaying the same zeal in pursuing French or European organisations for similar offences. Others added that this case was a classic example of many European DPAs’ “anti-big” bias – a tendency to go “headline hunting” and target the biggest brands in order to demonstrate a dedication to protecting data subjects.

But these accusations miss the point.

If there is a conscious “anti-big” bias in data privacy (which would be no surprise given wider geo-political trends), then that bias sits predominantly with the data subjects, not the data protection authorities.
A DPA will rarely begin a case of its own volition. Faced with limited proactive investigative resource, DPAs are alerted to potential foul play by receiving complaints from data subjects, and on examination of their merits and the seriousness of the offence(s), may initiate proceedings.

Perhaps unsurprisingly, since GDPR’s go live, almost every European DPA has reported large numbers of data subjects objecting to the ways in which the likes of Google and Facebook have collected and used their data. These high numbers of complaints will be an unavoidable effect of being some of the largest companies in the world – as any missteps will impact more people – but also a function of the underlying but growing “anti-big” popular sentiment and mistrust of large enterprise.

Clearly any DPA in such a situation will feel compelled to prioritise the cases attracting the greatest outcry – especially in the face of inevitable media attention, and regardless of the data subjects’ possible bias or of the nationality of the alleged offending company.

Secondly, this particular case was originally brought by two lobbyists: La Quadrature du Net (LQDN), who acted on behalf of more than 10,000 data subjects, and NOYB, a very powerful privacy pressure group that is headed by no less than Max Schrems, who made his name in privacy by bringing a case against Facebook that led to the invalidation of Safe Harbour. No DPA could realistically deprioritise a genuine case brought to them by these two bodies, especially when supported by hundreds of additional individual data subjects.

So to answer the question above, yes there could well be a trend in how DPAs pursue some cases over others. But the bias actually sits mainly with the data subjects – and those bodies that represent them en masse – and their apparent own eagerness to retaliate against “big”.

2. The “one stop shop mechanism” in practice

This is a question of which DPA leads actions brought against companies. The “one stop shop mechanism” within the GDPR dictates that where an organization has entities in multiple EU countries, the DPA of the country where the organization’s “main presence” is located shall lead the proceedings.

The role of “leading proceedings” means being the sole authority that the organization needs to deal with and respond to, while also requiring the chosen DPA to collaborate with the DPAs of other affected countries before making any decisions.

There was a fear that this might lead to “DPA shopping”, as organizations who suspected actions may be brought against them could theoretically move their main presence to a country whose DPA is more lenient or less proactive.

However, this case has shown that this – fortunately – will not work. It was deemed that despite any theoretical role in Google’s organizational structure, Google’s EU HQ in Ireland could not be considered the European data controller as it did not have decision-making powers over how data is processed. Being a controller is a prerequisite for the “one stop shop” rule to apply, and in the absence of a central European controller anywhere else, all of Google’s European entities were deemed to be data processors, making all European DPAs, including CNIL, equally free to bring actions.

This goes back to the main theme of our blog a couple of weeks ago about the Uber decisions, and how DPAs will determine organizational liabilities based on actions, not titles – a theme we will no doubt see again and again and that companies need to be aware of.

But despite Google and Uber both being fined in the last couple of months, don’t fall into the trap of believing that DPAs are only interested in targeting the largest companies. We are seeing plenty of actions being brought against smaller companies whose actions have affected large numbers of data subjects.

In fact, this mistake is one of the falsehoods of GDPR that we uncovered in our popular download, the 10 Myths and Fairy Tales of GDPR.

We offer a range of privacy services –  ‘privacy-first’ data management consultancy and specific data privacy regulations assistance, and importantly, GDPR services. 

Every year since 2006, the privacy industry has celebrated Data Protection Day, or as it became known outside Europe, Data Privacy Day

The day typically marks an opportunity for experts from the worlds of business, academia, consultancy and lawmakers to announce collaborations, hold crucial debates and work together to drive the privacy industry forward.

Arguably, privacy’s most vital next step is to make implementations of new policies and processes as successful as possible. The awareness stage is over – the dramatic rise in legislation in recent years and months is testament to that. As is the degree of attention that the media and its audience is paying to it. But the nature of the stories that the media is most often reporting shows us what the next step is: making the execution of new privacy-first strategies as unobstructive as possible.

In the related field of infosecurity, it has long been lamented that the easiest way to guarantee a breach is to make your processes and policies so frustrating that your workforce circumvent them. Privacy is the same.

Too many times have we seen reports of businesses completing their privacy audits, implementing new policies, but ‘frontline’ teams nonetheless either actively or naively bypassing them and falling foul of privacy legislation.

So our contribution to Data Privacy Day is aimed to help the industry better understand the nuances of privacy – not only in terms of what it requires, but also in terms of how to deliver it successfully.

We have built a dedicated resources page for Data Protection Day, including downloadable guides and observations from real-life client scenarios. We have also updated our famous Data Privacy Periodic Table with new legislation and future developments to be aware of, especially for today.

In the meantime, Happy Data Protection / Privacy Day!

Data Privacy News: What’s in a name? What the Uber fines teach us about local data privacy enforcement

The Uber data breach of 2016 is creating quite the ripple effect.

Most obviously, the hack’s revelation, and the media furore that accompanied it, caused numerous boards and management teams to ask the dreaded question of their data security teams, “Could this happen to us?” And many answers will have been sheepishly and concerningly in the affirmative.

But the ramifications go far beyond the reignited cybersecurity question. It has also highlighted an interesting legal point – and one that is often overlooked.

Uber 2016 data breach timeline – edited highlights

The Uber data breach of 2016 is creating quite the ripple effect.

Most obviously, the hack’s revelation, and the media furore that accompanied it, caused numerous boards and management teams to ask the dreaded question of their data security teams, “Could this happen to us?” And many answers will have been sheepishly and concerningly in the affirmative.

But the ramifications go far beyond the reignited cybersecurity question. It has also highlighted an interesting legal point – and one that is often overlooked.
October and November 2016 – Uber is hacked through a vulnerability in GitHub (an online resource for developers) which led them to Uber’s AWS login credentials. 57 million customers’ and drivers’ names, email addresses and mobile phone numbers are exposed, along with the driving licence and journey details for the 600,000 drivers affected. Uber conceals the hack and pays the hackers $100,000 to delete the data.
November 2017 – breach is revealed by Bloomberg and confirmed by Uber. Joe Sullivan, Chief Security Officer, and one of his deputies are fired for their roles in the cover-up, which was also known about by the then CEO, Travis Kalanick. Dara Khosrowshahi, who had taken over as Chief Executive Officer in the previous September, pledges transparency for the future.
May 2018 – GDPR comes into force, meaning the breach can only be penalised under pre-existing data protection laws, not GDPR.
July 2018 – Uber announces former Intel chief privacy and security counsel Ruby Zefo as Uber’s first Chief Privacy Officer and TomTom’s ex-VP for Privacy Security, Simon Hania, joins Uber as its first DPO.
September 2018 – US court fines Uber $148m as part of a legal settlement, avoiding a public court case in an action brought by 50 US states and the District of Colombia.
November 2018 – British and Dutch regulators impose fines on Uber of £385,000 ($490,760) and E600,000 ($678,780) respectively. Uber said in a statement, “We’re pleased to close this chapter on the data incident from 2016.”
December 2018 – the French Data Protection Authority fines Uber E400,000 ($460,000).

The events of November and December of last year are signalling a very interesting pattern that data privacy professionals need to take careful note of.

The Dutch regulator, the Autoriteit Persoonsgegevens, has ostensibly taken the lead on this case on behalf of all of Europe, on the basis that Uber’s European presence is headquartered in the Netherlands.

However, it is the way that the UK Information Commissioners Office (ICO) and the French Commission Nationale de l’Informatique et des Libertés (CNIL) have acted that has sparked the most interest. Not only have they fined the Dutch HQ for the impact of the breach on their own respective citizens, but they have also taken the additional steps of fining the local entities separately.

Why is this important?

Because Uber tried to prevent exactly this happening with its carefully worded intra-company agreements. In these documents, each of its local corporate entities were named as mere “processors” of personal data, not “controllers”, meaning under pre-GDPR legislation, they could not be held ultimately liable, nor fined.

But the French and British regulators disagreed. They ruled that the deciding factor was not how the corporate entity was named or considered by Uber’s internal privacy structure, but how they acted in practice. And because they performed the role of a local data controller, they could be held responsible for their part in the local infringements (such as not reporting the breach to the relevant regulators within 72 hours), just as the European headquarters could be fined for its role in the wider offences (such as failing to identify and rectify the vulnerability itself).

In other words, role-based liability comes down to how you act, not what you call yourself.

Lawyers will not find this ruling surprising at all. This is a standard tenet of common law.

However, many privacy professionals are not necessarily so experienced in the way the law works. Those companies whose privacy teams are experts in technology, security and policy, and not law, may overlook the need to ensure that the way their local offices operate reflects what the privacy structure expects, creating legal vulnerabilities in the process.

This is presumably exactly what has happened to Uber. Rather than their legal and privacy team trying to pull off a ruse based on a technicality, it appears that there is a clear mismatch between what the privacy structure anticipated of the local entities’ roles and how they acted in reality.

As we have said in these Data Privacy news blogs many times before, data privacy is a multi-faceted discipline, and far more complex in practice than many realise.

Privacy Shield is an EU-instigated unilateral agreement that obliges the US to protect the personal data of US citizens that came into force on 1 Aug 2016.

It’s fair to say that since then, Privacy Shield has not been considered the lighthouse of data privacy law. The history of US corporate observance is far less than positive. But this is perhaps unsurprising given its original construction lacked a legal foundation or punitive measures – as MEPs and the wider privacy industry and media have repeatedly and forcefully bemoaned.

Privacy Shield is required to be reviewed each year, during which it can be revoked if it’s not performing or being adhered to, and last month saw Privacy Shield’s second annual review.

Shaky ground?

As the review approached, there were various theories that Privacy Shield would indeed be suspended or even cancelled by the EU Commission in response to the US’ underwhelming response to the 10 recommendations (or perhaps demands) made by the EU this time last year.

One of the key requirements was new senior appointments to the PCLOB (Privacy and Civil Liberties Oversight Board), an independent agency headed by a board of at least three, ideally five, bipartisan members and designed to ensure personal privacy is not infringed in anti-terrorism activity or legislation. These appointments have been slow to say the least. A chair was appointed almost immediately, but two further senior members were only nominated in March and were for many months yet to be confirmed. Indeed, just before the review, a coalition of 31 organisations even called for faster action on this, noting that the PCLOB had only had a full senior complement for 4.5 of its 11 years!

MEPs also resented the US refusal to include Presidential Policy Directive 28 within FISA when it was reviewed at the end of 2017. This would have required US surveillance activities to safeguard all personal information, regardless of the individual’s nationality. This was rejected, and so the EU requested (and is still waiting for) evidence that FISA is not indiscriminately collecting data in direct violation of the EU’s Charter on Fundamental Rights.

Progress made

All of this said, it seems that this review may have resulted in some notable developments – ones that may save it from being suspended, cancelled or embarrassingly ignored.

The official report is due before the end of the year, but there have already been announcements of practical progress. For example, three PCLOB members were appointed on 12 October (one week before the review), creating a total of four, with one resignation pending and two further nominees before the Senate for approval.

Also, an acting Privacy Shield Ombudsperson was appointed in late September. Granted, this was also overdue and required after the first annual review a year ago, but Manisha Singh, a previous Undersecretary for State, now heads up the focal point for EU citizens to direct their complaints about the US Government’s treatment of their personal data. This appointment has been welcomed by the EU Commission, although judging by the language in the official press release, it is still a source of frustration for the EU that a permanent appointment is still outstanding.

Almost hidden in that same release however was a seed of something potentially rather significant:

“Among other things, the Commerce Department will revoke the certification of companies that do not comply with Privacy Shield’s vigorous data protection requirements.”

This is a new development, and assuming it is carried through in practice, it answers one of the main criticisms about Privacy Shield – its lack of enforcement. It also marks a notable change for the 4,000-odd companies registered with them.

Previously, Privacy Shield has been viewed by many as a tick box exercise. Companies would simply upload their privacy policies, pay a fee and then be self-certified. No third party had to be involved to verify the policies or their performance. Clearly, this was hardly robust.

If companies will now need to demonstrate compliance to the requirements of Privacy Shield, and by extension, create and follow more robust privacy policies and procedures, then for many this will result in a marked increase in effort to protect EU citizens’ data.

There may still not be the threat of financial fines, but active statements of enforcement are a marked improvement on the past. Revocation of certifications will most likely depend on complaints and whistleblowing, and it is true that the Federal Trade Commission has in two years only received four complaints of companies’ false or lapsed compliance. But GDPR and other national privacy legislation has heightened society’s and companies’ scrutiny of how data is collected, shared and used, meaning more objections are likely, in turn making the possession or loss of the certification more important.

We may well see revoked certifications having dramatic commercial impacts on those companies whose ability to tender for, or continue to hold, certain contracts depend on them holding that certification. For a few, that revocation may even be more dangerous than the fines possible under GDPR, and we all saw how those potential penalties spurred the global business world into action.

Of course, we have to wait and see what actually happens. Privacy Shield will most likely live to see another day, or year. The above warning will lead to either a serious change in how Privacy Shield operates and companies treat it, or the criticism of “toothlessness” will continue. The imminent report will reveal all, but it certainly appears that the wheels are in motion to require companies to go to a great deal more effort with Privacy Shield than they have before.

Data privacy in the UK has hardly been a quiet topic in recent months, but there have been two news stories from the last few weeks of particular note. They are each remarkable individually. Put side by side, they show a trend that is more thought-provoking than the sum of their parts.

It was announced in late September that Equifax was to be fined £500,000 by the UK ICO after hackers stole 15 million UK citizens’ various personal details and records last year. The vulnerability occurred because security patches were negligently overlooked by Equifax’s IT team. Even more galling is that only a couple of months previous, the business was warned by US Homeland Security that their infrastructure was not secure.

The £500,000 fine is the heftiest sum that the ICO could impose under the pre-GDPR Data Protection Act 1998. And to think that this is the same ICO that only a few years ago was frequently criticised for being unwilling to impose serious fines for data breaches. Even after 2010, when it was first empowered to issue financial penalties, it rarely “went big”. In those first five years, it only levied £7m of fines.

Largely, and perhaps in fact admirably, this was due to a policy of preferring support and collaborative remediation over fines. After all, many feared that fines would be considered by the largest businesses – and the ones that could do the most damage to the public’s privacy – as an acceptable risk of doing business, leaving illicit or unethical processes unchanged. Proactively helping businesses to respect subjects’ privacy without damaging their own productivity, and without threats, was seen by the ICO as the better way to deliver on its core goal – effecting real change amongst UK businesses.

This ethos was regularly reported as set to continue after the introduction of GDPR. Before its arrival, the ICO took great pains to push a strong message that the GDPR was a catalyst for them to work even harder to protect UK citizens’ data by ensuring businesses were using personal data legitimately – and not that it was a weapon to be brandished. Unless in the most serious circumstances.

This exception was reiterated by Emma Martins, the Data Protection Commissioner for Guernsey, when she exhibited the exact same mentality in our GDPR Interview Series, published before the GDPR May date. In it, she was quoted as saying:

 “The vast majority of processors and controllers want to do the right thing, so if we help them do so, we will all benefit. Having said that, we are going to be ready to implement the legislation if and when we need to. We of course should be seen to correctly address the serious breaches and that is certainly what we will do where necessary and appropriate.”

And so we come to the formal notice from the ICO to AggregateIQ, issued the day after the Equifax penalty was reported.

Both organisations committed their key transgressions before May 2018. But while Equifax’s errors were confined to a point in time in 2017, AggregateIQ not only profiled and targeted voters on behalf of Vote Leave during the Brexit referendum campaign in 2016, it then continued to process the data after May this year. This brought the case under the GDPR, and its far heavier penalties. AggregateIQ is appealing the notice, but the industry speculation is that the largest possible fine of E20m (or 4% of global turnover) is being considered.

In years gone by, the ICO was considered relatively benign. For some, even the two-pronged message of preferring to support rather than fine, unless forced to, was considered an opportunity to shirk difficult decisions. The cases deemed serious enough for headline-grabbing fines would be few and far between, and so the GDPR would remain little to worry about.

That no longer rings true. The Equifax incident has shown the ICO’s appetite, courage and determination to impose punitive measures. AggregateIQ will doubtless reinforce this. It is irrelevant whether the ICO is driven by its mission or by public pressure (and I personally think it is the former) – the net effect is that businesses will have to re-examine the legitimacy and ethics of their processing of UK citizens’ personal data.

The GDPR is only a law. It requires a body to enforce it, and the ICO is clearly up to the challenge.

Concern about the strict new General Data Protection Regulation continues to focus on security at expense of data privacy

93% of companies are worried about the storage of their data in the cloud after the General Data Protection Regulation (GDPR) and 91% are concerned about how the new rules will affect cloud services, according to new research from Calligo, a world-leading cloud solution provider.

IT decision-makers report inadequate levels of sponsorship from the C-suite despite the General Data Protection Regulation deadline next May

69% of board-level executives are neglecting to ensure the UK businesses they run will comply with the General Data Protection Regulation (GDPR), according to new research from Calligo, a world-leading cloud solution provider.

The figures were in a survey of 500 IT decision-makers in companies with more than 100 employees and £15 million turnover, examining how businesses are preparing for the new regulation.

Only 31% of respondents said they had governance sponsorship for GDPR at board level, while just 9% said their compliance departments were giving them full support. This lack of interest at the top level comes despite more than six out of ten (62%) respondents agreeing that the new regulation would affect the profitability of their business, including 19% who said the impact would be negative.

“It is worrying to see signs that GDPR governance does not have the full attention of so many C-level executives,” said Julian Box, CEO, at Calligo. “Too many of those at the top think it is all about security, when that is only a part of it.”

“The deadline for compliance is May 25 next year and any company that subsequently fails to handle data in the correct manner risks the severe penalties stipulated in the regulation. The top people in every organisation need to get to grips with this challenge, ensuring that their data is being stored and handled in full compliance.”

The survey found that only 43% of companies have appointed and resourced a Data Protection Officer, despite this being a requirement of the GDPR for medium-sized and larger businesses. In IT and telecoms, the figure is just 37%, while in manufacturing and utilities it is just 36%.

On average, organisations said they will employ 10 people on the task of achieving GDPR compliance, with healthcare sector proving the most committed, devoting an average 26 employees. This compares with averages of nine in IT and telecoms and four in arts and culture.

Calligo is an expert in the General Data Protection Regulation, which comes into force next year and which will standardize the protection of personal data of EU citizens.

Well, the last few months have been quite interesting to say the least on the political front, with the UK deciding married life no longer suits them and getting a divorce from their beloved European Union, whilst the US decide to “build that wall!” and elect Donald Trump.

Literally, as this blog is being written, a raft of Executive Orders are flying off the Oval Office desk with the ink still wet. We are witnessing a fundamental shift in superpower politics being initiated with unprecedented haste and vigour.

Yes, some of these decisions may have seemed fanciful at best to downright ridiculous some twelve months ago, but the reality is starting to dawn and a new world order is starting to take effect.

So as the dust settles regarding these monumental decisions, those of us involved in the wonderful world of regulation are being asked what it means for EU GDPR?

Now if this article seems to have taken a Tarantino’esq right turn and you are asking the question:

“What on earth is EU GDPR?” then you have some catching up to do. Put simply, it is the biggest single change to data protection since the introduction of the Data Protection Act of 1998 and the scope of it is global!

So in true streaming binge-viewing mode, here is what happened in series 1:

The vision of EU GDPR was to create one digital economy for the then 28 member states of the European Union, with one set of rules and regulations for handling the 500 million-plus citizen’s personal data. Essentially its central premise is to better protect the rights of those whose data is powering the digital highway on which we now all navigate.

In October 2016 TalkTalk were fined a record £400,000 for the theft of 157,000 of their customer’s records. Under the new regulations that fine could have been in excess of £70 million!

So from a 10,000 feet view the EU GDPR offers:

• Rights to the EU Citizen on how their personal data is used. (Citizens must be informed and give their explicit consent on how their data may be shared/utilised). Therefore, this has significant repercussions for data traversing country borders, made all the more difficult by President Trumps Executive Order that puts in question the long term future of the Privacy Shield agreement.
• Punitive punishments for those who do not protect this data (fines of up to 4% of global turnover or 20M Euros, whichever is the greater, can be levied).
• Citizens having the right to be forgotten – no more holding on to personal data for no reason.
• The requirement for organisations to declare, in detail, data breaches or loss within 72 hours (bear in mind many security experts claim most aren’t found for months currently).
• The responsibility of data owners to deploy “state of the art” systems to protect data (aged systems and technologies will not be an excuse).
• Organisations to create the role of Data Protection Officer, this role is new and must understand both the regulation and how their organisation is complying and policing the data of the citizens.

It’s a significant regulation and the above just scratches the surface, but at least gives some sort of scale to the change. BUT, what does all of this mean with the UK about to exit the EU? Well at first glance, it is simple and falls into two distinct camps:

• Organisations who will have EU Citizens personal data after we exit the EU.
• Those who will not.

If you’re in the first camp and would potentially hold any personal data from an EU Citizen, then you’re absolutely still required to comply to the regulation. The regulation was always designed to be a global requirement when dealing with EU Citizens personal data. It also comes from the perspective of protecting the EU Citizens data, wherever it may reside.

If you don’t, or will never hold any EU Citizen personal data (to get in perspective what personal data is, think anything that could identify them, IP address, credit card, name, address, phone number etc. etc. etc. and you start to see the footprint that personal data has), then you won’t need to comply.

However, as free movement and trade agreement negotiations continue, there will be conditions concerning the implementation of these agreements and you can be confident that the flagship regulation on handling personal data could form part of this. Also, considering the Data Protection Act of ’98 is so out of date, the UK needs a new standard – why would we begin the onerous task of writing one from scratch when the robust framework we contributed to is already sat on the shelf and gives us parity with Europe?

So as I write this article nothing is certain. However, the regulation came into force on May 24th 2016 and therefore predates Brexit, making it currently law. Equally, it is unlikely that down the line, organisations will be able to avoid it. The regulation will be enforced from May 2018, which means the fines will start with each non-conformance and it’s highly unlikely that we will be out of the EU by that date anyway.

It’s time to embrace the change and get compliant. After all, isn’t a more secure a diligent digital realm something to be applauded? Personal data is literally pulsing around the world, traversing jurisdictional boundaries and is potentially at risk if anyone in that chain of data handling isn’t aware or proficient in the discipline of protecting it.
So if all the above has you now thinking “ok, it sounds like I should be doing something about it” your next should be “how do I start?” Well, you are probably best to identify an organisation that understands the regulation and critically can assist you in mapping out how to specifically align your organisation to it.

Standards are always a welcome sign for a maturation of standards. GDPR is no exception, as you can qualify as a Certified Practitioner for the standard against the ISO17024 category. This is an important step forward, as much of the action to date has centred around commentary and opinions of the regulation, as opposed to establishing actual frameworks to implement.

One of the biggest challenges an organisation will face is in the actual identification of all the locations that actually contain the Personal Data. This will typically be dispersed over multiple systems and technologies, and actually locating these records will be a sizeable exercise in its own right. A few key tips around this data mapping exercise would be:

• Do we have this type of data?
• If we do then where is it located?
• What controls exist and what conditions under which it is kept?

A simple mantra is true, you cannot control what you cannot see. Therefore, you must build an accurate data map to even begin to implement the processes under which compliance can be achieved.

This article is only scratching the surface of the impact of this Regulation. The noise generated by the dramatic political events in the last year are only serving to create more confusion. But one thing is certain, the enforcement of the regulation begins in May 2018 and it’s safe to say that being one of the first organisations to fall foul of the new powers will be a very uncomfortable place to be.

It’s time to mobilise and get compliant, and that journey starts now.