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Do you have clients living in the EU? You may be subject to the GDPR.

Do you have clients living in the EU? You may be subject to the GDPR.

The General Data Protection Regulation (GDPR) was approved by the European Union on April 14, 2016, and became effective on May 25, 2018. It represents a significant overhaul of the EU’s data privacy laws in the past two decades. This article provides an overview of the GDPR, including its scope, key requirements, and potential consequences for non-compliance.

Who does the GDPR affect?

The GDPR applies to any company that offers paid or free services or goods to individuals in the EU regardless of location. The size of the firm is not a determining factor; instead, it is the activities of the company that dictate its compliance obligations. It is important to note that the GDPR does not apply to EU citizens when their data is collected outside the EU.

Activities triggering the application of the law

If you collect the personal data, also known as personally identifiable information, of an EU citizen while they are in the EU, that data is protected by the GDPR. It is essential to understand that simply having EU citizens visit your website does not automatically subject the data gathered to the law. Your business must specifically target EU citizens through your marketing efforts, such as using their language, currency, or country-specific domain extensions.

Processing personal data under the GDPR

The type and amount of personal data you can process depend on the purpose for which you are processing it. Some key principles to follow include:

Lawful and transparent processing: Personal data must be processed in a lawful and transparent manner, with clear communication to individuals about the purpose of data collection.

Minimization of data: Collect and process only the personal data necessary to fulfill the stated purpose and avoid using the data for any unspecified purposes.

Accuracy and updates: Ensure the personal data is accurate, up-to-date, and correct any inaccuracies promptly.

Storage limitation: Store personal data for the shortest time necessary, considering the purpose for which it was collected.

Security measures: Implement appropriate technical and organizational safeguards to protect personal data from unauthorized access, loss, or damage.

Information to provide individuals

When collecting personal data, you must provide individuals with clear and concise information, including:

  • Your company’s identity and contact information.
  • The purpose and legal justification for processing their data.
  • Categories of personal data collected.
  • Data retention duration.
  • Third parties who may receive the data.
  • Potential transfers of data outside the EU.
  • Individuals’ rights regarding access to their data and other data protection rights.
  • The right to lodge a complaint with a Data Protection Authority.
  • The right to withdraw consent.
  • Information about automated decision-making, if applicable.

Compliance and Consequences

Non-compliance with the GDPR can have severe consequences. Violations may result in fines of up to 20 million Euros or 4% of the company’s total revenue for the preceding year. Ensuring GDPR compliance is crucial for businesses with European Union resident clients to avoid potential financial penalties and reputational damage.

Navigating GDPR Compliance: Protecting Data Privacy and Ensuring Business Success

If you have clients that are residents of the European Union, you may be subject to the GDPR.  The consequences of not complying are steep.  Depending on the violation, you could face a fine of up to 20 million Euros or 4% of your total revenue for the preceding year.  Don’t wait to get put out of business, contact us today to schedule a consultation.

Author Bio

Leila Shaver is the Founder of My RIA Lawyer, a law firm that provides compliance and legal consulting for financial institutions. With extensive experience as a securities attorney and compliance expert, she has served as Chief Compliance Officer and General Counsel to RIAs, BDs, and TAMPs with billions in assets under management.

Leila understands the challenges RIAs face and is committed to helping RIAs streamline their processes, mitigate risks, and ensure compliance with regulatory requirements. She received her Juris Doctor from Atlanta’s John Marshall Law School and is a West Georgia Young Lawyers’ Association member. Leila has received numerous accolades for her work, including the Carroll County Bar Association’s Outstanding Young Lawyer Award in 2017.

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