It’s been almost three years since the GDPR took effect. Now that the initial uncertainty about it has started to clear up, many are asking: Was it a big deal?
This blog entry explains why the GDPR is definitely a huge deal. GDPR not only imposes strict requirements and hefty fines. It also massively impacts how businesses manage data security and avoid data breaches.
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GDPR and DATA Security
The EU’s General Data Protection Regulation (GDPR) lays down rules on how companies should handle the personal data they collect from EU citizens and residents. Among other things, it outlines strict responsibilities and requirements to ensure organizations keep consumer’s data private and protected.
These data security provisions cover areas such as implementing data protection protocols and roles, adopting a privacy-by-design approach throughout the organization, and mitigating data breaches. This gives the GDPR its reputation as the world’s toughest data privacy and security law.
An even more crucial GDPR component is the costly fines and penalties it imposes on businesses for noncompliance. Depending on the severity of the violation, fines can reach up to €20 million or 4% of annual revenue, whichever is higher.
Put simply, the GDPR makes it a very expensive mistake for businesses to skimp on data security.
Cost of Non-compliance
Just how much do data security violations cost businesses under the GDPR? This depends on various factors, but the overall trends show that data security infringements have so far been a major source of GDPR fines.
At the time of writing, the GDPR Enforcement Tracker reports a total of €275 million in fines levied since enforcement. Of this amount, €64 million comes from fines for “insufficient technical and organisational measures to ensure information security” (the second biggest category in the list).
In addition, four out of the five largest GDPR fines ever imposed have involved some form of data security violation (although the fines also included other non-compliance issues):
- H&M: €35.2 million (an error that left a network drive unprotected)
- TIM: €27.8 million (broad set of GDPR violations including data breaches)
- British Airways: €22 million (phishing websites hijacked site traffic)
- Marriott International: €20 million (cyber-attack that compromised user data including 31 million EU residents)
This clearly indicates that regulators are very serious about going after businesses that don’t adequately protect consumer data.
Comparing GDPR Fines With Other Data Privacy Regulations
To see how GDPR stacks up against similar data protection laws, here’s a quick comparison of the fines imposed by other GDPR-like regulations:
California Consumer Privacy Act (CCPA)
Civil penalties of $7,500/violation, statutory damages of $750/consumer/incident
Data Protection Act (DPA)
£17.5 million or 4% of global revenue
Digital Charter Implementation Act
CAD25 million or 5% of global revenue
Act on Protection of Personal Information
Personal Data Protection Law
Lei Geral de Proteçao de Dados (LGPD)
So, Is GDPR A Big Deal?
With strict responsibilities and steep penalties it places on businesses, the GDPR is a huge deal. But is it a big deal for your company, too? If you collect or process EU citizens’ and residents’ personal data, then it absolutely is.
As we’ve seen, data security makes up a critical part of GDPR compliance. In particular, it requires businesses to:
- Implement proper organizational and technical measures to protect personal data
- Assess how business decisions impact data protection
- Track data breaches and promptly notify affected parties
- Train employees on keeping data secure
In terms of how big a liability you’ll face for data infringements, regulators take various data security factors into account when calculating GDPR fines:
- The size and duration of the breach
- Type of data compromised
- Whether intent or negligence is involved
- Prevention and mitigation steps taken
- Record of past data breaches
Finally, as more GDPR-like regulations take effect, you’re bound to be governed by other data privacy laws at some point. Becoming GDPR-compliant helps you stay ahead at meeting similar regulations down the road. That makes GDPR quite a big deal for everyone.
In this post, you’ve seen what GDPR means for data security and why it’s a big deal for every business right now. The big takeaway is that GDPR mandates a data-privacy-by-design mindset which, in turn, needs robust data protection mechanisms in place.
That’s where TeamPassword can help. We give you tools to easily manage passwords across your organization so that data stays secure. Give it a try with a free 14-day trial today.