Chapter 10: Obligations of controllers – Unlocking the EU General Data Protection Regulation

Under the GDPR, the position on this issue has materially changed (e.g., the GDPR has introduced a new obligation that did not previously exist).

Under the GDPR, the position on this issue has not materially changed (e.g., although the wording may be different in the GDPR, the nature of the relevant obligation is unchanged).

The impact of the GDPR on this issue is likely positive for most organisations (e.g., because the GDPR provides certainty in relation to a previously unclear issue).

The impact of the GDPR on this issue is likely neutral for most organisations (e.g., because the requirements under the GDPR and the Directive are essentially the same).

The impact of the GDPR on this issue is likely negative for most organisations (e.g., because the GDPR introduced a new obligation on organisations).

The impact of the GDPR on this issue is unknown at this stage (e.g., because the impact on organisations is dependent upon secondary guidance that has not yet been written).

Definition of "controller"

In general terms, the "controller" is the entity that determines the purposes for which (i.e., "why") and the means by which (i.e., "how") personal data are processed.

Art.2(d)

In summary, a "controller" was defined under the Directive as an entity that, alone or jointly with others, determines how and why personal data are processed. A full definition is set out in Chapter 5.
 

 Art.4(7)

In summary, a "controller" is an entity that, alone or jointly with others, determines how and why personal data are processed. A full definition is set out in Chapter 5.

 The concept of a "controller" is essentially unchanged under the GDPR. Any entity that was a controller under the Directive likely continues to be a controller under the GDPR.

Accountability

The principle of accountability seeks to guarantee the enforcement of the Data Protection Principles. This principle goes hand-in-hand with the growing powers of DPAs.

Art.6(2)

The controller was required to ensure compliance with the Data Protection Principles.

 Rec.85; Art.5(2)

The controller is responsible for, and must be able to demonstrate, compliance with the Data Protection Principles.

 Under the GDPR, organisations are obliged to demonstrate that their processing activities are compliant with the Data Protection Principles (see Chapter 6).

Responsibility of controllers

In general, controllers bear primary responsibility for ensuring that processing activities are compliant with EU data protection law.

Art.6(2)

The controller was responsible for ensuring that its processing activities complied with the requirements of the Directive.

 Rec.74; Art.24

The controller is responsible for implementing appropriate technical and organisational measures to ensure and to demonstrate that its processing activities are compliant with the requirements of the GDPR. These measures may include implementing an appropriate privacy policy. Adherence to approved Codes of Conduct (see Chapter 12) may provide evidence of compliance.

 The general principle is unchanged. Where an organisation acts as a controller, it is responsible for ensuring that its processing activities are lawful.

 The GDPR provides additional detail on how organisations can demonstrate that their processing activities are lawful.

Data protection by design and by default

This principle means that compliance with EU data protection law should not be an after-thought, but should instead be treated as a key issue in the planning and implementation of any new product or service that affects personal data.

N/A

Although the Directive clearly obliged controllers to ensure compliance with its requirements, it did not specifically oblige them to take any particular steps with respect to the design or default implementation of any data processing activities.

 Rec.78; Art.25

Controllers must ensure that, both in the planning phase of processing activities and the implementation phase of any new product or service, Data Protection Principles, and appropriate safeguards, are addressed and implemented. For example, the controller must implement measures that provide for the security of any data processed, and give effect to the rights of data subjects (see Chapter 9).
 

 The GDPR imposes a significant burden on organisations by requiring them to ensure that data protection compliance is 'baked in' to their data processing activities. In addition organisations are required, by default, to process only the minimum amount of personal data necessary.

 The data protection by design obligation for employers is important as this means that where a device is issued to an employee, only the most privacy-friendly options should be selected.

Joint controllers

In relation to any processing activity, it is possible for more than one entity to be the controller (on the basis that more than one entity may make decisions about the purposes for which, and means by which, those data are processed).

Art.2(d)

The Directive did not use the term "joint controllers", but did recognise the fact that multiple entities may jointly determine the purposes and means of processing personal data.

 Rec.79; Art.4(7), 26

Where two or more controllers jointly determine the purposes and means of the processing of personal data, they are joint controllers. Joint controllers must, by means of an "arrangement" between them, apportion data protection compliance responsibilities (e.g., it should be agreed which controller shall be responsible for providing clear information to data subjects—see Chapter 9). A summary of the arrangement must be made available for the data subject. The arrangement may designate a contact point for data subjects.

 In many circumstances (particularly where processing takes place in an intra-group context) organisations may not realise that a joint controllership has come into existence. The GDPR obliges organisations to keep watch for potential instances of joint controllership. Where those instances arise, organisations must enter into suitable "arrangements" that apportion data protection compliance responsibilities between joint controllers.

Liability of joint controllers

Where liability arises in a joint controllership scenario, EU data protection law's primary focus is on ensuring that the data subject is protected. The question of how liability should be apportioned between the joint controllers, while important to organisations, is a secondary question from the perspective of EU data protection law.

Rec.55; Art.23(2)

The controller could be exempt from liability, in whole or in part, if it could prove that it was not responsible for the event giving rise to the damage. It could also be a defence to show that the liability arose in whole or in part from force majeure.

 Rec.79, 146; Art.26(3), 82(3)-(5)

Data subjects are entitled to enforce their rights against any of the joint controllers. Each joint controller is liable for the entirety of the damage, although national law may apportion liability between them. A controller may be exempted from liability if it proves that it is not in any way responsible for the damage. If one joint controller has paid full compensation, it may then bring proceedings against the other joint controllers to recover their portions of the damages.

 The GDPR makes joint controllers fully liable. Once "full compensation" has been paid to the affected data subject(s), joint controllers may recover damages from one another. This means that some joint controllers may find themselves facing much higher liability for claims made under the GDPR.

 The Directive included an exemption from liability for controllers regarding harm arising in cases of force majeure. The GDPR contains no such exemption, meaning that controllers may bear the risk in force majeure cases.

Appointment of representatives

Where EU data protection law applies to a controller (or, under the GDPR, a processor) established outside the EU (see Chapter 4), that controller (or processor) is obliged to appoint a representative in the EU, as a point of contact for EU data subjects and DPAs.

Art.4(2)

A controller established outside the EU was required to appoint a representative in the Member State whose data protection laws applied to that controller. The appointment of the representative was without prejudice to legal actions which could be initiated against the controller.

 Rec.80; Art.4(17), 27

A controller established outside the EU must appoint a representative in one of the Member States in which the controller offers goods or services or monitors individuals in the EU, unless the processing is occasional, small-scale and does not involve Sensitive Personal Data. The appointment of the representative is without prejudice to legal actions which could be initiated against the controller. The representative must be mandated by the controller or processor to be addressed in addition to or instead of the controller or the processor by supervisory authorities and data subjects, on all issues related to data protection. A representative may be subject to enforcement actions by DPAs in the event of non-compliance by the controller.

 Non-EU organisations whose processing activities are occasional, small-scale, and do not involve Sensitive Personal Data are not obliged to appoint a representative under the GDPR.
 
 Under the GDPR a representative may be liable for the controller's failure to comply with the GDPR. Organisations should therefore be wary of agreeing to act as representatives for third parties without strong contractual indemnities in place.

Appointment of processors

Organisations that act as controllers commonly appoint service providers to process personal data on their behalf. EU data protection law permits this practice, but imposes certain requirements on organisations that wish to do so.

Art.17(2)-(3)

A controller that wished to appoint a processor was required to only use processors that guaranteed compliance with the Directive. The controller had to appoint the processor in the form of a binding contract in writing, which stated that the processor:

• only acts on the controller's instructions; and
• ensures the security of the personal data that it processes.

 Rec.81; Art.28(1)-(3)

A controller that wishes to appoint a processor must only use processors that guarantee compliance with the GDPR. The controller must appoint the processor in the form of a binding agreement in writing, which states that the processor must:

• only act on the controller's documented instructions;
• impose confidentiality obligations on all personnel who process the relevant data;
• ensure the security of the personal data that it processes;
• abide by the rules regarding appointment of sub-processors (see Chapter 11);
• implement measures to assist the controller in complying with the rights of data subjects;
• assist the controller in obtaining approval from DPAs where required;
• at the controller's election, either return or destroy the personal data at the end of the relationship (except as required by EU or Member State law); and
• provide the controller with all information necessary to demonstrate compliance with the GDPR.
   

 The GDPR imposes significant new requirements that must be included in all data processing agreements. It is likely that processors located outside the EEA will resist the imposition of these new obligations, potentially making it harder for controllers to lawfully appoint their desired processors, and resulting in more complex negotiation of outsourcing agreements.

Records of processing activities

In order to ensure compliance, EU data protection law requires organisations to keep records of their data processing activities, and that the information in those records is provided to (or is available on request by) DPAs.

Rec.48; Art.18

Each controller (and its representative, if any) was required to notify the relevant DPA before processing any personal data. Member States could provide simplifications or exemptions from this requirement (e.g., some Member States allowed controllers not to register, provided that they appointed a DPO).

 Rec.82, 89; Art.30

There is no obligation to notify DPAs. Instead, each controller (and its representative, if any) must keep records of the controller's processing activities, including:

• the contact details of the controller/representative/ DPO;
• the purposes of the processing;
• the categories of data subjects and personal data processed;
• the categories of recipients with whom the data may be shared;
• information regarding Cross- Border Data Transfers;
• the applicable data retention periods; and
• a description of the security measures implemented in respect of the processed data.

Upon request, these records must be disclosed to DPAs.

 The GDPR removed the requirement to notify DPAs regarding an organisation's processing activities. However, in effect, the information that would have been included in such a registration is simply recorded by the controller (or its representative) for disclosure to the DPA upon request. Consequently, the obligation on organisations to identify and record their data processing activities has not materially changed.

 The GDPR provides an exemption for organisations employing fewer than 250 persons (unless the processing in question is of a high-risk nature).

Cooperation with DPAs

DPAs are responsible for enforcing and regulating EU data protection law. Controllers are therefore required to cooperate with DPAs.

N/A

The Directive did not explicitly require controllers to cooperate with DPAs, although this was generally a requirement under the national laws through which Member States created DPAs and provided them with powers.

 Rec.82; Art.31

Controllers (and their representatives, if any) are required to cooperate, on request, with DPAs in the performance of their tasks.

​​ The GDPR has merely codified the pre-existing de facto (or, in some Member States, national legal) obligation of controllers to co-operate with DPAs.

Data security

The idea that controllers should ensure the security of the personal data that they process is a core concept in EU data protection law. As noted in Chapter 6, the controller is also obliged to abide by the principle of data security.

Rec.46; Art.17(1)

The controller was required to implement appropriate technical and organisational security measures to protect personal data against accidental or unlawful destruction or accidental loss, alteration, unauthorised disclosure or access.

 Rec.83; Art.32

The controller must implement appropriate technical and organisational security measures to protect personal data against accidental or unlawful destruction or loss, alteration, unauthorised disclosure or access. Depending on the nature of the processing, these measures may include:

• encryption of the personal data;
• on-going reviews of security measures;
• redundancy and back-up facilities; and
• regular security testing.

Adherence to an approved Code of Conduct (see Chapter 12) may provide evidence that the controller has met these obligations.

 The Directive allowed for a significant amount of discretion on the part of the controller, in terms of the technical and organisational measures to be implemented in the controller's particular context. The GDPR is more prescriptive, but the net effect is very similar—the primary requirement is that the controller must ensure the security of the personal data that it processes.

Reporting data breaches to DPAs

DPAs can only take appropriate enforcement action in relation to data breaches if they are aware of those breaches. Therefore, EU data protection law requires controllers to report such breaches to DPAs in certain circumstances.

N/A

The Directive did not specifically oblige controllers to report data breaches to DPAs. Some Member States implemented data breach reporting requirements in their respective national laws.

 Rec.73, 85-88; Art.33

In the event of a data breach, the controller must report the breach to the DPA without undue delay, and in any event within 72 hours of becoming aware of it. There is an exception where the data breach is unlikely to result in any harm to data subjects. The notification must include at least:

• a description of the data breach, including the numbers of data subjects affected and the categories of data affected;
• the name and contact details of the DPO (or other relevant point of contact);
• the likely consequences of the data breach; and
• any measures taken by the controller to remedy or mitigate the breach.

The controller must keep records of all data breaches, comprising the facts and effects of the breach and any remedial action taken.

 The GDPR's 72 hour deadline for reporting data breaches to DPAs is likely to prove extremely challenging, as it will require organisations to identify, review and report data breaches under intense time pressure.

 Records of all data breaches must be included in the controller's internal data processing records (see above). All breaches must be recorded no matter how small, and these records must be disclosed to DPAs on demand.

 In addition, the notification obligations under the ePrivacy Directive continue to apply to telecommunications providers. Such organisations may therefore be required to notify a data breach twice (once under the GDPR and once under the ePrivacy Directive).

Notifying data breaches to affected data subjects

Data subjects can only take steps to protect themselves from the adverse consequences of data breaches (e.g., by replacing credit cards if their card details have leaked) if they are aware of those breaches. Therefore, EU data protection law requires controllers to notify affected data subjects of such breaches in certain circumstances.

N/A

The Directive did not specifically oblige controllers to report data breaches to affected data subjects. Some Member States implemented data breach reporting requirements in their respective national laws.

 Rec.73, 86-88; Art.34

In the event of a data breach causing high risk to data subjects, the controller must notify the affected data subjects without undue delay. The notification must include at least:

• the name and contact details of the DPO (or other relevant point of contact);
• the likely consequences of the data breach; and
• any measures taken by the controller to remedy or mitigate the breach.

However, the controller may be exempt from this requirement if:

• the risk of harm is remote because the affected data are protected (e.g., through strong encryption);
• the controller has taken measures to protect against the harm (e.g., suspending affected accounts); or
• the notification requires disproportionate effort (in which case the controller must issue a public notice of the breach).

 The obligation to notify data subjects imposes a potentially significant burden on organisations (especially those that process large volumes of personal data). This obligation also significantly increases the danger of widespread reputational harm arising as a consequence of a data breach.

 The exemptions provided under the GDPR largely reflect the position under pre-existing national laws. Most importantly, if the risks associated with the breach have been effectively resolved then the organisation may be exempt from the notification requirements.