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The General Data Protection Regulation (GDPR) is a regulation of the EU that sets strict privacy and security standards. To achieve this, many organizations rely on third-party service providers, or subprocessors, for data processing activities. In this blog, we will explore the role of GDPR subprocessors, their benefits and limitations, and steps that organizations can take to manage them effectively.
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What Are GDPR Subprocessors?
GDPR subprocessors are third-party entities that process personal data on behalf of a data controller. They have access or will have access to process the data from the data controller. For example, if a company uses a third-party email marketing service to send promotional emails to its customers, that email marketing service would be considered a subprocessor because it is processing personal data on behalf of the company.
Role Of GDPR Subprocessors In GDPR Compliance
GDPR subprocessors play a crucial role in GDPR compliance for data controllers. Data controllers are responsible for ensuring that personal data is processed in compliance with the GDPR, even when that processing is carried out by a subprocessor. The GDPR requires data controllers to have a written agreement with their subprocessors that includes specific data protection obligations. This agreement should cover how the subprocessor will handle personal data, ensure data security, and comply with GDPR requirements.
Why Are GDPR Subprocessors Needed?
GDPR subprocessors are needed for various reasons, including:
1. To enable efficient services
Many organizations rely on subprocessors to provide key services that help them run their business effectively. For example, a data controller may engage a subprocessor to process payroll, provide customer support, or maintain their IT infrastructure. By using subprocessors, data controllers can focus on their core business activities and rely on subprocessors to handle these support functions.
2. To enhance data security
Subprocessors can provide additional resources and expertise to enhance data security. They may have specialized tools, technologies, or processes to safeguard personal data from unauthorized access, accidental loss, or other security incidents. By using subprocessors with strong security controls, data controllers can reduce the risk of data breaches and other security incidents.
3. To ensure GDPR compliance
Data controllers are responsible for ensuring that personal data complies with the GDPR. This includes ensuring that subprocessors are GDPR-compliant and have adequate safeguards in place to protect personal data. By engaging GDPR-compliant subprocessors, data controllers can demonstrate their compliance with the GDPR and reduce the risk of fines or other penalties for non-compliance.
4. To meet operational needs
Subprocessors can provide specialized skills or resources that a data controller may not have in-house. For example, a data controller may engage a subprocessor to provide legal or technical advice, conduct a data protection impact assessment (DPIA), or provide specialized IT support. By using subprocessors with specialized expertise, data controllers can ensure that they have access to the resources they need to meet their operational needs.
Examples Of GDPR Subprocessors
Examples of GDPR subprocessors include:
- Cloud service providers: Many organizations use cloud service providers, such as Amazon Web Services (AWS), Microsoft Azure, or Google Cloud Platform, to store and process personal data. These providers act as subprocessors and are responsible for ensuring that personal data is processed in compliance with the GDPR.
- Payment processors: Organizations that process payments online, such as e-commerce stores, often use payment processors like PayPal, Stripe, or Adyen to handle transactions. These processors act as subprocessors and may have access to personal data, such as payment card information or billing details.
- Email marketing providers: Many organizations use email marketing providers, such as Mailchimp, Hubspot, or Constant Contact, to send marketing emails or newsletters. These providers act as subprocessors and may have access to personal data, such as email addresses or other contact details.
- IT support services: Organizations may engage IT support services, such as managed service providers (MSPs) or IT consultants, to provide technical support, maintenance, or monitoring of their IT systems. These providers act as subprocessors and may have access to personal data stored on the organization’s systems.
- HR software providers: Organizations may use HR software providers, such as Workday, BambooHR, or ADP, to manage employee data, such as personal information, payroll, or benefits. These providers act as subprocessors and are responsible for ensuring that employee data complies with the GDPR.
Limitations Of Having GDPR Subprocessors
While GDPR subprocessors can bring many benefits, there are also limitations to relying on third-party service providers for data processing activities. Some potential limitations include:
- Control over data processing: Data controllers remain ultimately responsible for ensuring that personal data complies with the GDPR, even when using subprocessors. This means that data controllers must carefully vet and monitor their subprocessors to ensure that they are complying with the GDPR and following the controller’s instructions for processing data.
- Data security risks: Engaging subprocessors can create additional security risks, as these providers may have access to personal data and may be targeted by cyber attackers. Data controllers must ensure that their subprocessors have adequate security controls in place and are taking appropriate measures to safeguard personal data.
- Lack of transparency: Data controllers may have limited visibility into their subprocessors’ data processing activities, which can make it difficult to monitor compliance and respond to data protection incidents. Data controllers need to establish clear communication channels and reporting mechanisms with their subprocessors to ensure that they are aware of any potential issues.
- Dependence on third-party providers: Relying on subprocessors can make organizations more dependent on third-party service providers, which can create additional costs and administrative burdens. Data controllers must ensure that their contracts with subprocessors clearly define roles, responsibilities, and liabilities to mitigate these risks.
How To Keep Track Of GDPR Subprocessors?
Keeping track of GDPR subprocessors is an essential part of GDPR compliance for data controllers. Here are some steps that data controllers can take to keep track of their subprocessors:
- Create a subprocessor inventory: Data controllers should maintain an up-to-date inventory of all subprocessors they engage in data processing activities. This should include details such as the name of the subprocessor, the type of services they provide, and any personal data they have access to.
- Conduct due diligence: Organizations should conduct due diligence on their subprocessors. This is to ensure that they are GDPR-compliant and have adequate security controls in place. This may involve reviewing subprocessor contracts, conducting audits, or obtaining certifications such as ISO 27001.
- Monitor subprocessor activities: Data controllers should monitor subprocessor activities. This is to ensure that they are complying with the GDPR and following the controller’s instructions for data processing. This may involve requesting regular reports, conducting audits, or performing risk assessments.
- Maintain records: They should maintain records of their subprocessor activities. This may include any data protection impact assessments (DPIAs) or risk assessments they conduct. These records should be up-to-date and made available to regulators upon request.
- Update contracts: Data controllers should ensure that their contracts with subprocessors include GDPR-compliant terms and conditions. These include requirements for data protection and security, rights to audit, and obligations for data breach notification.
Conclusion
In conclusion, GDPR subprocessors play a crucial role in helping organizations process personal data in compliance with the GDPR. By engaging third-party service providers for data processing activities, data controllers can benefit from specialized expertise and cost savings. However, relying on subprocessors also comes with risks and limitations that must be carefully managed. Data controllers must maintain an accurate inventory of subprocessors, monitor activities, maintain records, and update contracts. Seeking help from legal or compliance professionals can also provide additional guidance and support in managing subprocessors.
If you are looking to implement any of the Infosec compliance frameworks such as SOC 2 compliance, HIPAA, ISO 27001, and GDPR compliance, Impanix can help. Book a Free consultation call with our experts or email us at [email protected] for inquiries.
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